Cybersecurity » Get Ready For Cyber-Coverage Disputes

Get Ready For Cyber-Coverage Disputes

July 26, 2016

Companies should consider very carefully what types of cyber-breach events and losses they consider possible and do whatever they can to ensure their policy language will mandate coverage. Even then they should anticipate coverage disputes, according to Briggs & Morgan attorneys Phil Schenkenberg and Lauren Lonergan, writing in Cyber Security Business. They look at three recent cases, including one involving restaurant chain P.F. Chang. It had purchased a cyber policy marketed as a “solution designed by experts to address the full breadth of risks,” and paid a hefty premium for it too, according to this account, because as a “consumer-facing” company it was considered high risk. After a hack, the policy covered some of the loss, but a $1.7 million claim for “fraud recovery” assessed by credit card companies was denied. The denial was upheld in court.

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