There’s really little doubt in our minds that business insurance terms could be helpful to you. Insurance contracts are legal documents that often employ a language all their own. Words or phrases (known as “terms of art”) may not have the common definition or use employed in other contexts .
Insurance contracts often have definitions described in a glossary attached to the contract. That way, everyone who reads the contract starts with a common understanding of what those words mean. Each insurance contract that covers a specific type of risk may contain a glossary that contains that field’s “terms of art”.
One example of a specific type of risk is the liabilities and potential damages that companies living and working in cyber space face everyday. As cyber attacks evolve, glossaries evolve to include these new terms.
Here is a partial list of insurance terms that are common and relevant to cyber companies.
- Cyber Extortion. The money demand from a cyber attacker to the targeted company that asks for payment of a stated ransom amount in order to stop data theft, or regain access to captured data or access to a hijacked website, or to avoid other kinds of damage to the company’s network.
- Cyber Insurance, first party coverage. An insurance policy that covers a business’s costs when a hostile entity attacks its network.
- Cyber Insurance, third-party liability. IT liability insurance, usually part of an IT Errors and Omissions policy, generally provides coverage if someone sues the IT business for a security breach on a client’s network.
- Cyber Property. The internet related things that your company owns such as websites, data, and networks. Cyber insurance covers damage to your company’s websites, data and networks by others as well as the damage done by your company to other another company’s cyber property.
- Data Breach Notification Laws. State laws set out the time frames that require companies to notify individuals and government authorities in the event that an organization suffers a data breach that harms or threatens another company or harms an individual’s personal health, social security, or financial information.
- Digital Assets. These are the text, multimedia, and other digital files to which your business owns property rights.
- Errors & Admissions policy. A professional liability insurance that protects against claims for substandard work or for negligence, up to amounts stated in the contract. Such policies may cover court costs and settlements.
- Intellectual Property Liability. The law considers all internet content as published which means it is subject to copyright infringement and libel laws. New legislation creates more liability risk everyday especially in terms of privacy laws and domain name infringement. If you own a business in today’s digital world, you most likely own a website which means you are subject to the same legal realities that all publishers face.
- Small Business Insurance. Insurance to help small business owners manage the specific risks that their companies face.
- Technology E&O. Insurance that provides coverage in the event your client sustains a loss as the result of your company’s mistakes or omissions in a software program or web service.
Most important to remember is that traditional liability policies do not address the new technologies, cyber crimes and e-commerce exposures. If you have a traditional policy, you may face exposures in cyber space that you do not even realize.
If you want to learn more about professional liability coverage in the cyber context, read this article on Cyber Liability Insurance. To talk more about insurance terms, professional liability policies for other types of businesses, or anything else, please contact us. Let us help you protect your business.
Robert Macoviak is the President of Oyer, Macoviak and Associates. Oyer, Macoviak and Associates is the oldest independent insurance agency in Boynton Beach and has been in business since 1953. Oyer, Macoviak and Associates are vested members of the community who are committed to doing business face-to-face and being your insurance advocate in times of need.