Insurers face business interruption claims after global tech outage
By Noor Zainab Hussain
July 19 (Reuters) -Insurers could face a raft of business interruption claims after a worldwide tech outage crippled industries from travel to finance on Friday, insurance industry experts said.
A software update by global cybersecurity firm CrowdStrike CRWD.O appeared to have triggered systems problems that grounded flights, forced some broadcasters off air and left customers without access to services such as healthcare or banking.
"Insurers are bracing for hundreds, if not thousands, of claim notifications from organizations that are impacted by the CrowdStrike event," said Ryan Griffin, a partner focused on cyber at insurance broker McGill and Partners.
However, not all businesses would get insurance cover for their lost time and money.
A typical business interruption policy within a regular commercial insurance program would not provide coverage against losses stemming from Friday's outage, said Marcos Alvarez, head of insurance at ratings agency DBRS Morningstar.
And not every cyber insurance policy likely has coverage for business interruption; such coverage would have to be bought separately at extra cost.
"Some cyber insurance policies exclude non-malicious events, and there are waiting periods and deductibles that businesses will have to consider before making a claim with their insurance carriers," said Nir Perry, CEO at CyberWrite, a cyber insurance risk platform.
Perry said economic damages could reach tens of billions of dollars in such events, and added the outage should be considered an example of an "event that can produce what could be defined as an insurance catastrophe."
The event could also bring with it legal claims for CrowdStrike and Microsoft MSFT.O. A defective update by CrowdStrike, designed to protect Microsoft Windows systems, triggered the global IT outage.
CrowdStrike and Microsoft did not immediately respond to requests for comment.
"Airlines (and other industries) might have rights under their contracts that allow them financial or other remuneration based on the CrowdStrike outage," said Sam Levine, senior vice president - professional and cyber solutions at specialty insurance broker CAC.
The outage caused major issues for travelers around the world – grounding planes for hours.
Travel insurer InsureMyTrip said it anticipates an increase in travel insurance claims, with the most from travel delay and missed connection policies. More than 1,600 customers may be impacted as they depart for or return from trips on Friday, it said.
Industry experts also said that force majeure would not apply for the event.
Force majeure clauses in contracts remove liability for unforeseeable and unavoidable catastrophes that prevent participants from fulfilling obligations.
"This is exactly what cyber insurance is meant to cover. ... This is not something that is outside of our control," said Meredith Schnur, U.S. and Canada cyber practice leader at broker Marsh.
Reporting by Noor Zainab Hussain in Bengaluru; additional reporting by Nathan Gomes and Akash Sriram; Editing by Leslie Adler
Ativos relacionados
Últimas notícias
Isenção de Responsabilidade: As entidades do XM Group proporcionam serviço de apenas-execução e acesso à nossa plataforma online de negociação, permitindo a visualização e/ou uso do conteúdo disponível no website ou através deste, o que não se destina a alterar ou a expandir o supracitado. Tal acesso e uso estão sempre sujeitos a: (i) Termos e Condições; (ii) Avisos de Risco; e (iii) Termos de Responsabilidade. Este, é desta forma, fornecido como informação generalizada. Particularmente, por favor esteja ciente que os conteúdos da nossa plataforma online de negociação não constituem solicitação ou oferta para iniciar qualquer transação nos mercados financeiros. Negociar em qualquer mercado financeiro envolve um nível de risco significativo de perda do capital.
Todo o material publicado na nossa plataforma de negociação online tem apenas objetivos educacionais/informativos e não contém — e não deve ser considerado conter — conselhos e recomendações financeiras, de negociação ou fiscalidade de investimentos, registo de preços de negociação, oferta e solicitação de transação em qualquer instrumento financeiro ou promoção financeira não solicitada direcionadas a si.
Qual conteúdo obtido por uma terceira parte, assim como o conteúdo preparado pela XM, tais como, opiniões, pesquisa, análises, preços, outra informação ou links para websites de terceiras partes contidos neste website são prestados "no estado em que se encontram", como um comentário de mercado generalizado e não constitui conselho de investimento. Na medida em que qualquer conteúdo é construído como pesquisa de investimento, deve considerar e aceitar que este não tem como objetivo e nem foi preparado de acordo com os requisitos legais concebidos para promover a independência da pesquisa de investimento, desta forma, deve ser considerado material de marketing sob as leis e regulações relevantes. Por favor, certifique-se que leu e compreendeu a nossa Notificação sobre Pesquisa de Investimento não-independente e o Aviso de Risco, relativos à informação supracitada, os quais podem ser acedidos aqui.
