Pointing to a "real risk" of a cyber crime strike on local Bahamian businesses, NUA Insurance Agents & Brokers has launched a new cyber liability product.
The company is taking the view that "if it could happen to Target, it could happen to you".
Over the last Christmas holiday, the popular U.S. retail giant came under fire after it found itself the target of a cyber attack.
Credit and debit card information, as well as personal data, were stolen from millions of its customers. Now, Target is facing a string of lawsuits.
It's a situation that the leading insurance agency has been watching and just one of the reasons it decided to launch a new cyber liability product on April 24, 2014.
"We have noted that there have been more and more reports of computer hacking disrupting companies' computer systems and leaking sensitive third party information stored on companies' computer systems," said Assistant Managing Director of NUA Insurance Agents & Brokers Stanford Charlton.
"This stolen third party information, in most cases, is taken to be used with criminal intent to defraud a business. The Target superstore loss, where a large portion of the details on their clients' credit card identities was stolen also made it quite real that this type of risk is here at our doorsteps."
He continued, "You could also have an instance where a media company's employee posts libelous statements about a competitor on their company Facebook page. With that being said, we know that these types of risks will become more and more prevalent in The Bahamas. Cyber liability insurance was a product created to minimize the effects of the losses that result from these risks, and we wanted to be proactive in making it available in The Bahamas very early on.
"It should also be mentioned that there could be breaches to the Data Protection Act and a company can be levied fines against them in the event it is discovered that adequate measures were not in place to safeguard clients' personal data. Cyber liability insurance affords some protection against those fines."
According to Charlton, e-commerce companies and those undertaking transactions over the Internet aren't the only ones who face cyber risks. He said companies that store personal data, are reliant on computer or telephone networks, hold digital information or use the Internet all face these exposures.
Accounting firms, law firms, retailers, entertainment and media, professional service companies, doctors, dentists, pharmacists, walk-in clinics, utilities, manufacturers and wholesalers are also at risk.
Some of the key features of the coverage include: cyber liability, privacy liability and privacy breach notification costs; coverage for data held 'in the cloud'; comprehensive media liability, including coverage for user generated content; defamation, including libel and slander; invasion of privacy; intellectual property rights infringement; cyber crime including identity theft, wire fraud and phishing scams, etc.
"Various industries, like retail stores, hotels, airlines, media, accounting and law firms and manufacturers, would be able to benefit from cyber protection against the risks prevalent," said Charlton.
"It should also be noted that many professionals believe their professional indemnity insurance policy should cover them against any and all possible scenarios, but there are certain exclusions to the cover, and cyber liability insurance is the blanket cover that protects against these exclusions."
The cost of the cover, according to Charlton, is dependent on the type of business, its annual turnover and the number of employees it has.
Premiums could be as low as $400 for a $1 million limit.
"The cyber liability insurance facility limits vary for different aspects of cover and can range from $250,000 to $2 million. We also have the capability to look at the risk profile of each client individually, as the $2 million limit may not be adequate. In these cases we can go in the London open market and attain higher limits," said Charlton.
NUA is hosting a product launch cocktail reception at the British Colonial Hilton on April 24 from 6:30 to 8:30 p.m. Its security, cyber and network coverage will be available immediately at the launch.
Charles Juarbe, divisional director, FINEX Global & Willis Limited, will be the presenter at the launch, which is expected to be attended by 75 invited guests. The guest list covers a wide cross section of the business community.
"We trust that they will see the benefits of this coverage in these very crucial and uncertain economic times. Insurance protection is one of the keys, in my opinion, to minimizing the effects of this uncertainty," said Charlton.

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