Cyber Insurance Myths Putting your Business at Risk!

Lack of education, emerging risks, and inconsistent policy language sow confusion in the cyber market. Two CNA experts debunk common but dangerous myths and offer facts in their article for Risk & Insurance:  4 Cyber Insurance Myths That Are Putting Your Business at Risk.

Take a quick look at the myths: 

Myth #1: Cyber insurance covers every loss related to the use of a computer.  As it states ‘calling it ‘cyber insurance’ is a a misnomer, just because a computer is involved doesn’t mean it’s going to trigger a cyber policy. 

Myth #2: Insurance terms and conditions are consistent across all basic standalone cyber policies. Although the traditional cyber market has matured to the point where first- and third-party coverages have grown fairly consistent, there is still no standard form used by all carriers. This means policy wording, terms and conditions and exclusions can — and do — vary from one insurer to the next. 

Myth #3: My cyber and other P/C insurance policies together will protect me from emerging risks.  Cyber exposures increasingly intermingle with other categories of insurance risk, including property and fidelity. More automation in manufacturing, for example, creates more opportunities for system failures. Machinery malfunction could lead to property damage, bodily injury, or product defects. 

Myth #4: It doesn’t matter which insurance carrier I buy my policy from. According to Nick Graf, Assistant VP of Information Security, Risk Control, CNA, “I see a lot of insureds making decisions mostly based on cost,” Graf said. “Comparing two cyber policies is like comparing apples to oranges because the types of insurance coverages included in the policies, how broadly things are defined, the exclusions — they can vary greatly.” Also check out cna.com/cyber for a wealth of beneficial Cyber insurance information.