Cyber Risk – What's a Business to Do?

© 2014 The Texas Lawbook.By Amy Dunn Taylor – (November 21) – Blitz-Krieg and Bomber and Heartbleed – the names sound positively demonic and they are as Sony, JP Morgan, Target and others can attest. Virtually every business and organization is vulnerable, admittedly some more vulnerable than others. Each face the very real yet insidious threat of suffering a data breach. What’s a company or organization to do in the face of these invisible but very real threats? Is cyber risk insurable and if so, what products are available? Traditional coverage available to businesses and organizations include comprehensive general liability policies and more specialized polices for business interruption, directors and officers acts, errors and omissions and corporate crime policies.Each of these has its pros and cons in the cyber theft world but the one thing every risk manager, general counsel and chief information officer must know is this: Increasingly, traditional insurance products are being written to specifically exclude cyber risks and breaches. There are both practical and business reasons and determining which insurance to purchase requires a thorough understanding of both sides of the equation. The Practical Side Under Comprehensive General Liability (GCL) policies, “damages” have been interpreted to mean…