Intuitive Insurance Articles

Insuring Information Assets

The advent of the internet has seen enormous growth in innovation and communication, enabling the realization of exciting new business ideas, worldwide media accessibility, and enhanced employment opportunities. Yet, accompanying this progress is the ubiquitous threat of cybercrime, which is becoming increasingly prevalent. The WannaCry ransomware attack on 12th May and the most recent Petya cyber attack are highly illustrative of the damage and disruption cybercrime can cause, as well as the vulnerability of many businesses to malicious cyber attacks.

Instances of cybercrime are certainly on the rise; according to annual surveys conducted by Telstra, almost 60 percent of businesses experienced at least one disruptive security breach a month in 2016, compared to just 23.7 percent in 2015. With this rising threat level, it is important to identify the types of cyber threats that are readily employed.

According to Varonis Data Security, the top three cyber threats in 2016 were social engineering, which made up just over half of all cyber threats, followed by insider threats, and advanced persistent threats. Furthermore, according to the FBI, a diverse range of companies around the globe lost more than U.S. $3.1 billion in the period October 2013 to May 2016 as a result of social engineering fraud. But what exactly is social engineering fraud, and how can you reduce your chances of being a victim?

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Association Liability

As a professional association, your key agenda is to represent the needs and concerns of your membership body, individual office bearers and employees, and the organisation in its entirety. Designed specifically for Associations and Not-For-Profit Organisations, Association Liability insurance combines Professional Indemnity and Directors and Officers Liability to ensure that you are protected against the inimitable risks facing community associations.

Association Liability provides protection to office bearers and directors, as well as the association itself, against litigation arising from wrongful acts in the management of the association, employment practices liability and fidelity. In addition, Association Liability also provides coverage to the association against claims for financial loss arising out of a breach of professional duty by the association.

Associations and Not-For-Profit Organisations are often exposed to litigation related to a range of issues, including breach of professional duty, Trade Practices Act matters, defamation, and breach of contract or consumer legislation. It is therefore important for Associations and Not-For-Profits to minimize their risk by having appropriate insurance.

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Understanding IT Liability

Information Technology’s hold on our world has become increasingly tighter due to the demands of our high speed, interconnected and ever-changing global society. The ever-increasing need for improved speed to market, greater competition, customer expectation, and increased reliance on outsourcing systems and data, has meant that information technology has continued to evolve with ferocity. As such, many individuals and businesses today could not fathom a world without technology.

However, as businesses come to rely more and more on Information Technology (IT) for the smooth and successful operation of their business, they are also significantly more vulnerable to litigation. IT professionals and businesses face increased exposure for the quality of the advice they provide, as well as for any damage that may be caused by the performance of the products they supply. In addition, IT companies face financial loss threats due to systems not performing as intended or not being delivered within contractual time frames, due to breaches of Intellectual Property Rights, such as copyright, trademark or register design, or due to the loss of data.

To address these issues insurers have developed Information Technology Liability Insurance, which ensures specific protection for organisations against legal liability arising from the failure of their products, services and/or advice in the conduct of their business.

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Public and Products Liability

According to the Australian Competition and Consumer Commission, in recent years the average size of a settled public liability claim has increased from $11,000 to almost $17,000. Congruently, there has been a stable increase in the number of public liability claims made. As such, the importance of Public and Products Liability for all business owners has grown substantially.

No business, industry or even sole trader is exempt from some degree of risk. Managing the risks inherent in your business is a responsibility that all owners have to third parties, which includes customers, employees, suppliers, and the community more broadly. When an accident occurs that is not reasonably foreseeable and causes damage to the property of another party, or causes injury to a person other than an employee (who is generally covered under workers compensation), the business may be found legally liable for the injury or damage.

Public Liability insurance is therefore vital for all businesses, as it provides protection for you, your employees, and members of the public, by covering any financial costs involved if a third party seeks compensation for your negligent actions.

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Retroactive Date Explained

Reading through an insurance policy can often seem a formidable task. Laden with an involved and intricate lexicon of industry jargon, it is often difficult to decipher the important information. Amid a slew of limits and excesses, insuring clauses, and extensions, sit a series of important dates used to determine the period of coverage being offered. While the “Effective Date” and “Expiration Date” of a policy are easily recognised and understood as the dates on which the policy’s coverage begins and expires, respectively, the “Retroactive Date” is less well understood.

The retroactive date is a key term included in every liability policy written on a “claims-made” basis. A policy offering claims-made coverage will only cover claims that are reported during the policy period. Such a policy would not cover claims filed before or after the active policy period, regardless of when the loss occurred. Under a claims-made policy if the insured fails to immediately report a claim or circumstance that may give rise to a claim, they may forego their right to indemnity.

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Cover your costs: privacy breach notification and cyber liability

According to the Ponemon Institute’s 2015 Cost of Data Breach Study, the average per capita cost of data breach in the United States is $217, while the average total organisational cost is $6.5 million. Comparatively, in Australia, the draft Regulation Impact Statement cited the average cost of notification at $70,000, while the total cost of a data breach is typically upwards of $2.82 million. While this is significantly lower than the cost of data breach in the United States, the economic impact of data breach for Australian businesses carries substantial weight.

In light of the Federal Government’s Notifiable Data Breaches Bill passed through the Senate this week introducing a mandatory data breach notification scheme, we consider how these laws will affect your business and the role of insurance in reducing the cost of a data breach.

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Insure your Instagram

The unique needs of media professionals require distinctive insurance cover to protect against the significant costs associated with defending claims for financial loss that may arise from erroneous or negligent publication of material. Media liability insurance provides cover from exposures such as misleading advertising, defamation, invasion of privacy, copyright or trademark infringements, and breach of contract.

According to Suzie Shaw, Managing Director of Sydney based advertising agency, We Are Social, “social influencers are effectively our future media owners”, and as such, they require the same level of insurance cover as other media professionals, particularly in safeguarding against misleading advertising.

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The evolving landscape of Management Liability Insurance

A recent uptick in the severity and frequency of Management Liability Insurance claims has resulted in some significant industry-wide changes to these policies. Many insurers are looking to increase premiums and deductibles, while restricting cover and limiting their exposures. Not only will these changes impact new policies, they are even being applied on renewal, altering cover that may have been in place for a significant length of time.

The most notable and business-critical change is insurance companies’ growing reluctance to include cover for securities claims, which is particularly important for start-up companies and those that require ongoing cash injections.

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Does your IT Liability Insurance provide the right protection?

Information Technology Liability Insurance is essential for any IT organisation or company, providing a unique combination of Professional Indemnity Insurance and Public & Products Liability cover. However, the host of products available makes it difficult to determine which policy will meet the needs of your organisation and provide you with the right level of protection.

The key is to simply ask the right questions in order to determine which policy is right for you.

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Global Clinical Trial Insurance

Designing an insurance program for a global clinical trial is an exceptionally complex task. Exposure to experimental products presents a multitude of risks for all stakeholders, be they institutions, investigators, contract research organisations (CROs), sponsors, ethics committees (ECs) / institutional review boards and/or trial participants themselves.

Unfortunately, risks are unavoidable in any clinical trial. Even with comprehensive preclinical research and high-quality study design, conduct and monitoring, risks such as bodily injury to participants and/or financial and reputation risk to trial stakeholders (through legal proceedings and judgments) are a possibility. However, these risks can be mitigated or transferred through a well-designed insurance program.

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