Recent Cases Highlight Potential Pitfalls of New Cyber Insurance Products

Recent Cases Highlight Potential Pitfalls of New Cyber Insurance Products

June 14, 2016, Covington Alert

Two recent litigation developments involving cyber insurance serve as a useful reminder to policyholders: a cyber policy purchase can be full of traps for the unwary. This alert discusses the traps that resulted in one company losing coverage for a major portion of its losses from a payment card data breach, while another company faces a lawsuit by its cyber insurer seeking to void its policy. It also offers practical tips to avoid these traps.