Dark Reading is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Comments
What Legal Language Should I Look Out for When Selecting Cyber Insurance?
Newest First  |  Oldest First  |  Threaded View
Richard F.
50%
50%
Richard F.,
User Rank: Strategist
10/7/2020 | 11:32:17 PM
Subtle Danger - Disasterous Consequences
Even more dangerous is the trend of increasing numbers of insurers, especially foreign insurers, to insert unexpected arbitration and choice of law provisions.  Many businesses do not read or fully understand the entire policy, including the "fine print." Insured businesses only discover when coverage is denied or disputed, coverage disputes are not resolved locally in their state court, by state judges knowledgible about the businesses own state insurance laws. 

Instead those businesses are often forced into very expensive arbitrations in distant states, under another state's laws, or even required to assert their claims in foreign countries with that country's laws controling the arbitration process. The arbitrators are often insurance industry insiders, frequently active or former officers or directors of insurance companies or reinsurance companies. Many experienced policyholder attorneys advise rejecting any insurance that tries to impose arbitration, or foreign law, especially if the place of arbitration "venue" is not in your home state.

Yes, it can be very difficult to obtain higher limits of coverage, or to assemble a reasonable insurance tower and avoid arbitration. After 40+ years as an arbitrator and counsel in arbitrations, I can assure you it is well worth taking the time to obtain the right coverage.

The officers and directors of any business considering an insurance policy that has arbitration or choice of law provisions or foreign venue provisions must ask, "Can our business afford to pay the cost to retain local attorneys, and New York attorneys or London barristers as counsel, and to also pay the expenses of 3 arbitrators and the costs of hearings in New York, Hamilton, Bermuda, London, England etc.?"

My Jesuit instructors used to advise, "If you can not be a good example, at least serve as a horrible warning."

Hurricane Katrina destroyed some of my clients' Louisiana businesses.  Multiple layers of insurance refused to pay and disputed coverage. As an example, the deposit for each of 4 separate arbitrations averaged USD $250,000.00.  While my clients had a destroyed major building and no ability to conduct business, they had to raise approximately USD $1,000,000.00 to simply start the arbitrations. Then they also had to pay for teams of lawyers and half of the cost of 12 arbitrators each charging $750 to $1,000.00 an hour to argue about whether coverage existed under New York and English insurance law. OThe contractually stated venue for one arbitration was Hamilton, Bermuda.  The remaining three arbitrations were contractually required to be held in London, England.   

BEFORE buying cyber insurance, consult a knowledgible policyholder lawyer, and a good insurance broker. If you do not, you may be in for a very rude and expensive education.  IF your business even survives.

 

 


Commentary
Ransomware Is Not the Problem
Adam Shostack, Consultant, Entrepreneur, Technologist, Game Designer,  6/9/2021
Edge-DRsplash-11-edge-ask-the-experts
How Can I Test the Security of My Home-Office Employees' Routers?
John Bock, Senior Research Scientist,  6/7/2021
News
New Ransomware Group Claiming Connection to REvil Gang Surfaces
Jai Vijayan, Contributing Writer,  6/10/2021
Register for Dark Reading Newsletters
White Papers
Video
Cartoon Contest
Write a Caption, Win an Amazon Gift Card! Click Here
Latest Comment: Zero Trust doesn't have to break your budget!
Current Issue
The State of Cybersecurity Incident Response
In this report learn how enterprises are building their incident response teams and processes, how they research potential compromises, how they respond to new breaches, and what tools and processes they use to remediate problems and improve their cyber defenses for the future.
Flash Poll
Twitter Feed
Dark Reading - Bug Report
Bug Report
Enterprise Vulnerabilities
From DHS/US-CERT's National Vulnerability Database
CVE-2021-31476
PUBLISHED: 2021-06-16
This vulnerability allows remote attackers to execute arbitrary code on affected installations of Foxit PhantomPDF 10.1.3.37598. User interaction is required to exploit this vulnerability in that the target must visit a malicious page or open a malicious file. The specific flaw exists within the han...
CVE-2021-31477
PUBLISHED: 2021-06-16
This vulnerability allows remote attackers to execute arbitrary code on affected installations of GE Reason RPV311 14A03. Authentication is not required to exploit this vulnerability. The specific flaw exists within the firmware and filesystem of the device. The firmware and filesystem contain hard-...
CVE-2021-32690
PUBLISHED: 2021-06-16
Helm is a tool for managing Charts (packages of pre-configured Kubernetes resources). In versions of helm prior to 3.6.1, a vulnerability exists where the username and password credentials associated with a Helm repository could be passed on to another domain referenced by that Helm repository. This...
CVE-2021-32691
PUBLISHED: 2021-06-16
Apollos Apps is an open source platform for launching church-related apps. In Apollos Apps versions prior to 2.20.0, new user registrations are able to access anyone's account by only knowing their basic profile information (name, birthday, gender, etc). This includes all app functionality within th...
CVE-2021-32243
PUBLISHED: 2021-06-16
FOGProject v1.5.9 is affected by a File Upload RCE (Authenticated).