Commentary in Mealey's Litigation Report: 2020 Cyber And Privacy Coverage – A Year In Review

In a new commentary published in Mealey's Litigation Report: Emerging Insurance Disputes, partner Scott Seaman—the co-chair of the firm's global Insurance Services Practice Group—and partner Judy Selby provide a year-in-review of key cyber and data privacy coverage developments.

The authors note the pandemic-driven, and largely unplanned, massive shift to remote work created increased cyber risks that have already led to an uptick in cyber claims. They further discuss how the continued proliferation of new privacy and cyber laws will likely drive cyber insurance claims activity not only for data breach events, but also for information misuse claims having nothing to do with a breach. Finally they review so-called "silent cyber" coverage cases, including ransomware, business email compromise, and privacy violations.

The article concludes:

"On the coverage litigation front, even though insurers were largely successful in defending silent cyber claims in 2020, we expect that policyholders – particularly those who have not obtained cyber insurance – will continue to seek coverage for privacy and cyber claims under non-cyber policies. Insurers are urged to closely following legal and regulatory developments in this area and to consider their underwriting procedures and policy wordings across all coverage lines in light of these emerging and often high-stakes risks. Currently there is a relative dearth of judicial decisions interpreting and applying cyber-specific policies. However, we expect that, over the next couple of years, the pace of judicial decisions under cyber-specific policies will increase markedly."

Read the full Mealey's Litigation Report article (PDF)

"2020 Cyber And Privacy Coverage – A Year In Review" was published by Mealey's Litigation Report: Emerging Insurance Disputes, January 2021.