While it feels like we've been talking about Cyber Liabilitycover for years now, the fact is, in relative terms it's still newterritory for insurers. Appropriate pricing is best determinedthrough solid analysis of a variety of data, and underwritershaven't yet been able to gather enough history on this type ofexposure to do an ideal job of quantifying this risk.

However, there's no denying that the threat is quite real. As ofthis writing, Sony Pictures is the latest high-profile victim of amajor cyber breach, one from which some are saying it might neverrecover. In December, the situation for Sony executives—andstockholders—went from bad to worse each day. The real lesson ofthe Sony incident is that it could happen to any company thatdoesn't focus heavily on its cyber security, no matter its size.Which is why it's concerning that A.M. Best reveals in its Fall2014 Insurance Industry Survey that 53% of insurer respondents saidthey currently do not purchase Cyber insurance for their owncompanies.

That's right: More than half of the insurers polled by A.M.Best—the bulk of which were primary carriers, and 68% of which werefrom the property & casualty industry—admit they do not buyCyber Liability cover. Some 30% of respondents who said they dopurchase this coverage maintain $1 million to $5 million in limits;the rest acquired slightly larger amounts.