When I was the editor of National Underwriter at the dawn of this decade, the notion of cyber risk was not even on the radar of most board directors and even some company officers. Yet less than seven years later, I can't cite an exposure causing a greater degree of anxiety among those at the top of the corporate pyramid.
Indeed, a sense of dread about how far up the ladder such liabilities could rise was palpable throughout the Risk and Insurance Management Society's recent annual conference, where one of the many cyber sessions I attended was ominously entitled: “Protecting your board directors and executives from a cyber nightmare.”
|D&O coverage scrutiny increasing
Board members and the officers they are entrusted to oversee are becoming increasingly agitated and inquisitive about cyber risk management efforts at their companies — particularly when it comes to insuring them against derivative lawsuits that could be prompted by a major event. As a result, those charged with buying commercial insurance, along with their brokers and insurance carriers, should expect intense scrutiny about the adequacy of cyber coverage, since data breaches, ransomware attacks, and other technology-related exposures may put directors in the crosshairs of plaintiff attorneys.
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