New cyber policies featuring innovative enhancements are playing a crucial role in protecting American businesses from the risks they face on a daily basis.
One such innovation, from NAS Insurance, involved adding Telephone Consumer Protection Act (TCPA) defense coverage to cyber policies. First implemented in 1991, the TCPA has been responsible for hundreds of costly consumer class action lawsuits. Many companies have been sued for handling personal information incorrectly and not preventing the criminal or accidental misuse of client details.
“Making TCPA defense coverage a part of a cyber liability policy is important because it is not something that fits specifically into a general liability commercial policy,” says Jeremy Barnett, senior vice president of marketing at NAS Insurance Services. “Adding it as an enhancement to cyber makes it explicit for insureds; they know that their claims will be covered.”
Enhancements that cover data lost by a third party are proving to be just as important. It’s a feature that covers the activities of companies the insured does business with, protecting against accidentally lost data or criminal breaches out of the insured’s control.
“The idea that the cyber policy of the insured can extend to their third parties is a real benefit because so many clients rely on consultants and outside parties to complement what they do,” Barnett says.
“It’s an enhancement that meets the way things work today. IT services, specifically, are so often outsourced and we wanted to create a policy that reaches those service providers should an incident occur. It means the insured can feel more confident.”
NAS’s contingent bodily injury enhancement covers a business in the event that a cyber-related breach or event leads to some type of bodily injury. For example, if a manufacturing system is hacked and then malfunctions, causing injuries to people in a factory, the insured will be covered for any resulting claims.
“This enhancement may overlap with a property policy, but it can provide additional coverage if it can be proven that the cause of the injury was related to a cyber event,” Barnett says.
