The U.S. District Court for the District of Utah recently issued an opinion construing cyber insurance coverage — one of the first cases of its kind. The court determined in Travelers Property Casualty Co. of America v. Federal Recovery Services, Inc. that there was no cyber insurance coverage under a technology errors and omissions policy, because the allegations against the insured included only claims of intentional misconduct. Similar to traditional forms of liability insurance, the errors and omissions cyber insurance only covered mistaken, negligent, or otherwise unintentional conduct.
As data security breaches have become commonplace, many insurers have responded by limiting or excluding coverage for data-related events and claims under traditional policies, and have instead offered separate cyber insurance policies. While there has been much discussion about cyber insurance generally, few courts have yet construed cyber insurance policy terms.
Continue Reading Cyber insurance not a cure-all for data disputes