Cyber insurance: Growing pains. 9 February 2017 Transforming healthcare Michael Schmitt

Transcription

1 Cyber insurance: Growing pains 9 February 2017 Transforming healthcare Michael Schmitt

2 Cyber Incidents Headlines Target Corporation (2013) 110 Million records compromised $240 million cost of reissuing cards and refunding fraudulent charges Anthem (2015) 69 million to 80 million records compromised $140 million estimated cost to manage breach FriendFinder (2016) 412 million accounts compromised Yahoo! (2013) 2016 public disclosure 1 Billion accounts compromised Names, dates of birth, addresses, security questions and answers and weakly protected passwords 4

3 Residual Cyber Cover 7

4 Cyber Cover in GL Policies Travelers Indemnity vs Portal Healthcare Solutions (2015) Coverage: Data leaked = Publication Zurich American Insurance Co. vs Sony Corporation of America (2014) No Coverage: Data Leak Publication State Auto P&C Insurance Co. vs Midwest Computers (2001) No Coverage: Data Tangible Property Eyeblaster, Inc. vs Federal Insurance Co. (2010) Coverage for Tangible Property (computer) No Coverage for Intangible Property (data) NMS Services, Inc. vs The Hartford (2003) Coverage: Data = Tangible Property. Business Interruption Cover provided. 8

5 Prudential Regulation Authority Guidance suggested for carriers: 1)Investing in cyber expertise 2)Setting clear appetites and strategies 3)Continuous oversight or management of silent cyber risk 9

6 Swiss Re Corporate Solutions Cyber Offering 10

7 Cyber Underwriter Areas of Concern Business Model vs High-End Security Consolidations & Mergers Budgeting & Staffing Medical Devices The Value of PHI 12

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9 Cyber Incidents Headlines Target Corporation (2013) 110 Million records compromised $240 million cost of reissuing cards and refunding fraudulent charges Anthem (2015) 69 million to 80 million records compromised $140 million estimated cost to manage breach FriendFinder (2016) 412 million accounts compromised Yahoo! (2013) 2016 public disclosure 1 Billion accounts compromised Names, dates of birth, addresses, security questions and answers and weakly protected passwords 4

10 Residual Cyber Cover 7

11 Cyber Cover in GL Policies Travelers Indemnity vs Portal Healthcare Solutions (2015) Coverage: Data leaked = Publication Zurich American Insurance Co. vs Sony Corporation of America (2014) No Coverage: Data Leak Publication State Auto P&C Insurance Co. vs Midwest Computers (2001) No Coverage: Data Tangible Property Eyeblaster, Inc. vs Federal Insurance Co. (2010) Coverage for Tangible Property (computer) No Coverage for Intangible Property (data) NMS Services, Inc. vs The Hartford (2003) Coverage: Data = Tangible Property. Business Interruption Cover provided. 8

12 Prudential Regulation Authority Guidance suggested for carriers: 1)Investing in cyber expertise 2)Setting clear appetites and strategies 3)Continuous oversight or management of silent cyber risk 9

13 Swiss Re Corporate Solutions Cyber Offering 10

14 Cyber Underwriter Areas of Concern Business Model vs High-End Security Consolidations & Mergers Budgeting & Staffing Medical Devices The Value of PHI 12

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