Esurance - A radical new approach to Cyber Liability Insurance
There has been a tremendous boom in e-activities in the past few years that have opened up new opportunities for business. However, this boom has also brought a new set of risks such as viruses and hackers. Even traditional business risks like employee fraud and defamatory statements can be increased enormously. But what really makes things worse is the way many insurance companies have reacted to these new risks: minimal cover for maximum cost. If you're not careful, you could spend thousands on a policy riddled with loopholes.
Our philosophy is to offer comprehensive cover for the lowest possible cost.
Why do I need Esurance?
Simple, If your business is connected to the internet in any way (even just by email), then you expose yourself to a new dimension of risk. Some of these risks are new, such as viruses and hackers, whilst some traditional risks become greater on the internet, such as fraud and defamatory statements. Esurance is effective protection against these risks.
More than an insurance policy
The vast majority of insurance policies work in similar ways, by recompensing you against loss. Of course, this is how Esurance works. But it's not the only way that it works. Esurance also gives you access to round-the-clock professional help. After all, a company's reputation can be damaged just as easily as their systems can be hacked into or their computers can be infected with a virus. So, if someone's threatening to sue you, Esurance will provide you with lawyers. If your computer systems or records are damaged, then Esurance will provide you with IT consultants. If you suffer fraud, Esurance provides forensic experts. And if your brand is damaged, Esurance will provide you with PR consultants. What's more you'll be able to speak to our team, rather than an answering machine, 24 hours a day.
Summary of Cover
Esurance works in two ways
First is Esurance Liability. This covers you for claims made against you including claims for libel or slander, breaches of intellectual property and confidentiality rights, as a result of email or your access to the internet.
Esurance will pay your defence costs, your legal liability to third parties - and any claimants' costs - for any claim made against you arising out of your 'e-activities'.
But Esurance doesn't stop there. You can also choose to cover all of the following:-
- The cost of replacing and restoring lost computer records and/or computer systems as a result of viruses, hackers or employee fraud.
- Your financial losses due to third parties or employees using your computer systems fraudulently.
- Losses arising out of e-related illegal threats or extortion.
- Legal fees incurred in the enforcement of your intellectual property rights against others' web site content.
- Recovery of lost profits because you were unable to trade as a result of your systems being damaged by viruses, hackers or fraud.
- Payment of charge-backs to the bank.(i.e. those sums requested as reimbursement from you due to your customer's payment for your goods or services subsequently being refuted, and you not having their signature-on-file).
- Claims made against you by your employees arising out of your e-activities, such as claims alleging an inappropriate workplace or sexual harassment charges from an employee due to disturbing e-mail content, or for breaches of confidentiality or employees rights of privacy.
- Brand protection, including the cost of using a PR consultancy to limit damage to your brand and reputation.
The above points are a summary of Esurance. Please click here to download the full policy wording which also tells you about the exclusions.
How does Esurance link with my existing insurance policies?
Esurance has been designed to cover those areas of risk not covered by your existing insurance policies. Because we've made Esurance so comprehensive, it's possible there could be overlaps with your office package policy, your professional indemnity policy or any other specialist policies you may have.
Some famous cases
If you're still not convinced about the need for Esurance, the following makes sobering reading. Almost weekly, another company becomes the victim of online fraud or libel. Here are just a few examples.
Viruses
An email virus swept the world in March 1999. The virus replicated itself and sent itself to other networks undetected, corrupting files in nearly 60 major companies in the USA and impacting on thousands of other companies around the world. The final implications of this virus have not yet been established.
In May 2000, the 'ILOVEYOU' or 'Love Bug' virus spread even faster round the world than the Melissa virus. The virus infected email systems globally, by copying itself to all addresses in a computer's address book. The virus then deleted sound and picture files (mpeg. and jpeg. files) on infected systems. The havoc affected some of the biggest companies in the world. In fact, Computer Economics, Inc. has estimated that the "ILOVEYOU" virus affected 45 million computer files and cost companies $2.61 million.
Libel
In March 2000, UK Internet Service Provider Demon Internet found itself in court after a series of damaging allegations about an individual were published on one of its bulletin boards. The allegations were made about Dr Laurence Godfrey. Dr Godfrey contacted Demon and asked them to remove the messages because he felt they were defamatory.
The case was settled at the High Court and it cost Demon in excess of £250,000.
Perhaps the most serious libel case of recent times was that against Norwich Union. An employee circulated a series of internal emails claiming one of their competitors was being investigated by the Department of Trade and Industry.
These found their way to Norwich Union's competitor who promptly started legal action. The result was that Norwich Union paid £450,000 in compensation.
After buying some beef from Asda, policeman David Eggleton discovered it was off. He returned it to the store and was refunded. However, the Asda employee he dealt with believed Mr Eggleton had acted dishonestly. He circulated the policeman's details on Asda's electronic bulletin board, effectively accusing him of fraud. Mr Eggleton discovered this and an action for libel was threatened. Asda accepted this and paid a "substantial sum" in compensation.
Hacking
In April 2000, hackers hijacked 2000 websites. Some of the high profile sites included manutd.com, adidas.com and mgm.com. The hackers were able to access e-mail and financial details of registered customers. Spoof emails were sent to customers seeking them to change their registration details to addresses in Serbia, Kosovo, and Albania. Visitors to the affected sites were greeted with the message, "Kosovo is Serbia. Be happy if we hacked your site because we only hack the best sites on the internet!".
Denial of Service
In Spring 2000, amazon.com, buy.com, eBay, CNN Interactive, E*Trade, Yahoo! and ZDNet fell victim to a co-ordinated series of attacks. These attacks, known as Denial of Service attacks, rendered their servers useless due to bombarding them with a tremendous amount of 'hits'. At its peak, the attack on Yahoo! had one billion hits per minute landing on their server, forcing them to close the site and costing as much as £300,000 in lost advertising revenue alone.
The FBI, who investigated the incidents, also became a victim of a Denial of Service attack, too!
Credit Card Fraud
Expedia is an internet success story, selling more than $1 billion in airline tickets, hotel and car bookings. But in February 2000, it announced it had been the victim of massive fraud and had taken charge of between $4 and $6 million in one quarter to cover the cost of purchases made with stolen credit cards. These losses could be as much as 16% of revenue and wipe almost 30% off their gross profits.
How to apply for an Esurance Quotation
We've made the process of buying Esurance as simple as possible.
There are just three easy steps you need to take in order to get your cover:
- Download and complete the proposal form and return to Tysers
- We will provide you with a quotation
- Accept quotation and we will confirm cover is in force and send you an invoice and policy document.
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