Cyber Insurance and the COVID-19 Pandemic


By: Matthew Jones

In light of the Covid-19 pandemic, various professions have changed their policies on working remotely. When the initial lockdown and quarantine process began, some companies were forced to begin working remotely to stay afloat. And even now when certain states begin to “re-open”, companies are allowing their employees to continue working remotely. However, some companies may not have the proper technology and security features to prevent cyber-attacks, which have increased significantly during the pandemic. In addition to that, some companies do not have the proper insurance in place to compensate for damages due to a cyber-attack. Although cyber insurance is occasionally bundled into existing property or liability insurance policies, that is not always the case.  Sometimes, those policies fail to explicitly include or exclude cyber-attacks, thereby leaving insurers at a great risk of loss. 

The legal profession is one industry that has seen an increase in cyber-attacks given the utilization of remote depositions and court appearances via Zoom and similar platforms. Even though these capabilities existed years prior to the pandemic, they have become much more commonplace in today’s business. But with their continued use comes vulnerability and additional claims. One way to counteract these claims is for insurers to require certain types of technology and/or security features within businesses as a prerequisite to cyber insurance, or draft policies so they explicitly state whether there is coverage to avoid additional costs of litigation. No matter how this issue is dealt with, it will likely lead to an increase in litigation as the technology world continues to evolve.

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