AIG: first insurer offers standalone primary coverage caused by cyber attacks

One of the biggest US-American insurance companies namely the American International Group just declared that it will be the first insurer to offer standalone primary coverage for property damage, bodily injury, business interruption and product liability caused by cyber attacks.

Due to the fact that “Cyber is a peril [that] can no longer be considered a risk covered by traditional network security insurance product[s]” AIG released the new product CyberEdge Plus.

AIG commented on the new product as followed:

“CyberEdge can provide companies with protection against the following:

• Third-party claims arising from a failure of the insured’s network security or a failure to protect data. Insurance also responds to regulatory actions in connection with a security failure, privacy breach, or the failure to disclose a security failure or privacy breach.
• Direct first-party costs of responding to a security failure or privacy breach by paying costs of notifications, public relations, and other services to assist in managing and mitigating a cyber incident. Forensic investigations, legal consultations, and identity monitoring costs for victims of a breach are all covered.
• Business interruption caused by a network security failure by reimbursing for resulting lost income and operating expenses.
• Threats made against a company’s computer network and confidential information by an outsider attempting to extort money, securities, or other valuables. Coverage includes monies paid to end the threat and the cost of an investigation to determine the cause of the threat.
• Liability faced by companies for content distributed on their website. Coverage is provided for numerous media perils including copyright infringement, trademark infringement, defamation, and invasion of privacy.”

Furthermore, the coverage has a limit of up to $100 million.