Boards Confront Cybersecurity, With Insurance Part Of The Mix

Boards of directors have a duty to confront the issue of cybersecurity and may be liable if they don’t. The task is open-ended and complicated. Some guidance is provided by a so-called cybersecurity framework that has been developed by the Department of Commerce, and a voluntary program has been established by the Department of Homeland Security, but these are works-in-progress. Meanwhile cybersecurity insurance is available, and the insurance industry is playing a role in developing standards and pressuring boards toward confronting the issue, but there are reasons why this dynamic is less than a complete solution. Where does that leave the board? The writers, attorneys J. Wylie Donald and Jennifer Black Strutt from McCarter & English, consider the issue and conclude with some advice from the DHS.