CYBER INSURANCE: Watch Your Article Forms Closely By Ben Albright Cyber Insurance is, to some extent, the wild west of today’s insurance marketplace: some new outlaw seems to be popping up in the virtual saloon every other week and turning things on its head. Carriers are still trying to figure out how to price the risks and retentions in order to actually make a profit, and (perhaps most frighteningly for
agents) forms aren’t standardized. We take for granted a good ISO form in some other lines where we mostly need to skim the exclusions and endorsements list to ensure our client has the right coverage, but not so in Cyber. A recent court case in Mississippi highlighted just how volatile those forms can be with only a thin and blurry line between a policyholder having coverage and a certain E&O exposure for the agent. The case, Mississippi Silicon Holdings, LLC v. Axis Insurance Co., centered around the differences between social engineering fraud, computer transfer fraud, and funds transfer fraud. In essence, the court held that the company was responsible for paying the lower sublimit for social engineering but not the full million-dollar limits for funds transfer fraud or computer transfer fraud, because (although the fraud
