Cyber Liability a Tough Sell, but It's Up to Agents to Convey Its Importance

BROOKLYN, N.Y.—Cyber-liability insurance may be a hard sell for independent agents, but the changing nature of exposures and the responsibilities states have imposed upon businesses are making it a growing necessity for even smaller mom-and-pop operations, says an educator.

States are taking the initiative on privacy laws; laying out requirements for business owners to protect clients’ personal, says Cathy Trischan, commercial-lines manager for E&K Agency Inc. in Eatontown, N.J.

And lost, stolen or destroyed information is restricted to data on computer, says Trischan. Indeed, unsecured file cabinets or papers sitting out on a desk are subject to the same privacy regulations and duty to inform as a major corporation suffering a hacking attack to its computer system.

In the event there is a breach of personal data, states have laid out very specific actions an individual business must take with respect to informing clients and offering further protections, says Trischan.

The exposure, she says, is a major selling point for agents as they urge their clients to purchase cyber-liability coverage.

“Tapping into that pain makes them pay attention better,” she says.

Her comments came during a continuing-education class held here at the annual Professional Insurance Agents of New York’s Metropolitan Regional Awareness Program.

Many business clients, she says, have little understanding about what they need to do when there is a data breach. They need help to get through the process.

“Would you like someone to help you figure out what to do and have some money to help you do it?” says Trischan in an example of a conversation agents should have with clients. “I have a policy that can help you with some of these costs and exposures.”

She says agents need to be mindful that every insurer’s policy is different, with various degrees of coverage and different names to describe what is included in a policy.

It is very important for agents to have in-depth discussions with their client about particular exposures to ensure that the policy is tailored to meet the individual risks, she says.

“If you tell a client that you have a system in place, then you better [have one],” Trischan told agents attending the class. “You represent to the client what the coverage is, and you make sure that the coverage is there.”


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