Cybersecurity risks continue to expand nearly unabated. While it can feel like trying to hold back a tidal wave with a bath towel sometimes, effective tools do exist and can be easily accessed.

What must always be remembered is that a commitment to resilience and pre-emptive mitigation remains imperative. Insurers are well-positioned to serve not only as financial first responders but as partners in managing these evolving hazards, along with their business associates and partners.

According to the Insurance Information Institute, “The first line of defense is creating a robust cybersecurity system, training employees on how to identify a potential attack, encrypting company data, and enabling antivirus protection. With only half of businesses reporting a consistent encryption strategy, and the cost of data breaches continuing to rise, organizations must do more to protect themselves and their customers.”.

Some commonly seen cyber liability risks include:

• Liability—You may be liable for costs incurred by customers and other third parties as a result of a cyber attack or other IT-related incident.
• System recovery—Repairing or replacing computer systems or lost data can result in significant costs.
• Notification expenses—In several states, if your business stores customer data, you’re required to notify customers if a data breach has occurred or is even just suspected.
• Regulatory fines—Several federal and state regulations require businesses and organizations to protect consumer data.
• Class action lawsuits—Large-scale data breaches have led to class action lawsuits filed on behalf of customers whose data and privacy were compromised.

To extend cyber liability insurance coverage requires the purchase a stand-alone cyber liability policy, customized for your business to cover several types of risk, including:

• Loss or corruption of data.
• Business interruption.
• Multiple types of liability.
• Identity theft.
• Cyber extortion.
• Reputation recovery.

Contact the professionals at Evergreen for more information and guidance on obtaining the proper level of cyber liability insurance coverage for your situation.

Copyright 2023 Evergreen Insurance

Evergreen Insurance provides these updates for information only, and does not provide legal advice. To make decisions regarding insurance matters, please consult directly with a licensed insurance professional or firm.

Securing appropriate insurance for your business and property can be enough of a process on its own. So what does the concept of coinsurance represent? Nothing less than protection for both the insured and the insurance provider.

Let’s start with defining our terms. Coinsurance is a property coverage provision set by your insurer that requires you to carry coverage for a certain percent of your property’s value. That way, your insurer can be sure you have adequate coverage if you need to make a claim, and it can ensure that its resources are adequate to cover that claim.

In a typical commercial property insurance policy, a coinsurance clause ensures that you carry adequate coverage to protect your assets. For instance, for an office building valued at $200,000, you would need at least $200,000 in property insurance coverage. If your policy has a clause with a coinsurance percentage of at least 80%, that means you must insure the building for at least $160,000. If you purchase less coverage, the insurance company may not pay out the full value of your damages, even if they fall within the limits of your policy.

Say you file a claim after a fire causes $100,000 worth of property damage. Your property insurance policy has a limit of $150,000 and a $5,000 deductible. Per your coinsurance clause, you were required to purchase at least $160,000 in coverage. Because you failed to meet your coinsurance percentage of 80%, you will face additional costs as determined by the ratio of the amount you carried divided by the amount that was required: $150,000 / $160,000 = 0.937. So if your loss was $100,000, your insurer will pay $93,700 minus your $5,000 deductible. Your total costs will end up being $11,300.

Not every insurance company includes a coinsurance clause in its policies. However, those that do require coinsurance typically have three reasons for doing so:

• To ensure clients have adequate coverage. 
• To protect their pool of resources to better handle real-world claim situations.
• To encourage accurate assessment and underwriting.

The bottom line? When you’re required to meet coinsurance limits and do so, you’re more likely to make an accurate assessment of the value of your assets, which protects the insurance provider and you in the long term. Contact the professionals at Evergreen for more information on coinsurance and how it can apply to your business coverage.

Copyright 2023 Evergreen Insurance

Evergreen Insurance provides these updates for information only, and does not provide legal advice. To make decisions regarding insurance matters, please consult directly with a licensed insurance professional or firm.

Employee-related lawsuits can be time-consuming and costly for your business. Employment practices liability insurance can help shield your business from these suits. What does this liability insurance cover? Click on the image to download or print the information sheet.

A sharp rise in the number and size of ransomware losses over the past three years is changing the availability and cost of cybersecurity insurance coverage, according to the Insurance Leadership Forum. Annual cyber liability rates have increased more than 40% in recent years, in fact.

Insurance providers are carefully managing the growing risk, with some scaling back coverage options for business customers and others continuing to make coverage widely available because the threat is both ever-present, growing and evolving rapidly.

Some insurers continue to make this coverage available to customers with whom they have a wider relationship. Certain insurers have elected to only write cyber liability for companies with less than $100 million in revenue to reduce the insurer’s exposure.

These factors combine to make the need for cybersecurity insurance more urgent than ever, and to secure adequate coverage at reasonable rates. Contact the professionals at Evergreen to learn more about available cybersecurity coverage that’s right for your business.

Copyright 2023 Evergreen Insurance

Evergreen Insurance provides these updates for information only, and does not provide legal advice. To make decisions regarding insurance matters, please consult directly with a licensed insurance professional or firm.