Cyber and Crime policies are you clear on what they cover? by John Goodacre
In a world where we have become so heavily reliant on computers it is no surprise that criminals have turned to cyber-crime, where they can commit an act from the comfort of their own home, hiding in the anonymity of cyber space.
In 2015, cyber-crime was included in the UK national statistics for the first time and by earlier this year fraud and cyber-crime were the UK’s most common offences, accounting for over 50% of all crime.
With statistics like this it is no wonder the insurance industry has responded with the launch of numerous products, including crime and cyber liability.
Cyber is very much an emerging risk and insurers are developing their own products all of the time and seemingly moving at very different speeds in term of cover. When asked about Cyber Insurance, often the actual concern is nearer to a form of social engineering or ‘phishing’. For example we have all heard of the Friday afternoon email instructing an employee to make an urgent payment to a client, subcontractor or Director, only to discover, too late that it was something more sinister. The next procedures in the world can still fall down principally because they rely on humans and we can all make mistakes.
You may automatically assume that this is cyber-crime and therefore covered under a cyber insurance policy however, whilst your employees error was paying the fraudulent invoices, the digital channel was only a vehicle by which payments were made. The crime itself is a case of old fashion fraud and would be dealt with under a separate crime policy or a crime extension to a Directors and Officers policy.
As you may have realised cyber insurance isn’t straight forward and you may already have some form of coverage under your existing policies. Don’t leave it too late to check what your policies cover, if in any doubt speak to your broker for clarification.