Cyber Insurance – FFs & CHBs You've heard sues testimony and I'm sure you're all anxious to get signed up for cyber insurance but just relax and let's get through the slides first   The world is changing very fast and technology brings huge opportunities but can be extremely dangerous and costly to a company with a breach. I was tasked with the job of redesigning our website 6 months ago and met with the designer. 12 years old was building websites and hacking the local shops in town. I was studying for my bar mitzvah at 12 and it didn't go well. Cyber Insurance – FFs & CHBs Jason Wieselman 4/23/15

Emerging Threat 50% of Organizations Experienced at Least 1 Security Incident in the last Year 73% Implemented Data Breach Response Plan 10% Purchased Insurance 2013 26% Purchased Insurance 2014 . Most Breaches are never reported so this number is much higher Small Companies are a target due to their lack of advanced security Big corporations spend billions on security now and are still compromised The cost of each breach is way up and number of records exposed is exponential .www.intlbondmarine.com

. http://map.ipviking.com/ Most Incidents aren’t reported .www.intlbondmarine.com

. http://map.ipviking.com/ .www.intlbondmarine.com

Managing the Risk CGL Policy Evolution Cyber Exclusions & Sub-Limits Cyber Cover Stand Alone Option Big Brokers Provided a Solution . Policies focus on Tangible Property, Bodily Injury and relatively unchanged in 25 years. Companies realized exclusions existed and purchased coverage in 2014 at 26% over 10% in 2013 Marsh, Aon, Willis all wrote white papers on cyber and offered a coverage solution Cyber fits more as a Legal Liability and E&O add on .www.intlbondmarine.com

Common FF & CHB Policies What is Covered Transfer Risk - Cyber Gap CORE COVERAGES Common FF & CHB Policies What is Covered Transfer Risk - Cyber Gap You don’t hear from us very often regarding new coverage offerings but we have been asked by our customers for a cyber solution. E&O/Cargo Liability/Warehouse Legal/Contingent cargo/MTL/CGL/Auto/WC/Umbrella Cyber is excluded Two options. Assume the risk or Transfer of risk from your bottom line to the Policy. With the trajectory of this problem, every company will have this coverage in the future. Question is will you purchase it now or later. .www.intlbondmarine.com

Bank Routing Details Importer Identity (SS & EIN) Shipping Documents SENSITIVE DATA Bank Routing Details Importer Identity (SS & EIN) Shipping Documents We looked at the type of organizations being targeted and we see Banks, CC Companies, Healthcare, Retail and the common denominator is the sensitive nature of the data they store on servers. CHBs and FFs are in that world. We learned from Nike How sensitive importer and shipment data can be and potential Copyright/IPR liability. You can easily be sued. Luckily Sue promised me 10 bucks an hour for her firms services over drinks last night. See I have her signature on this cocktail napkin. If breach leads to stolen shipping Dox and money is routed fraudulently. Had to spend thousands to report the breach to the state and PR. .www.intlbondmarine.com

Cyber Coverage 1. Data Loss & Theft 2. Notification Expenses 3. Investigation Expense 4. PR and Marketing Costs 5. Biz Income Lost Revenue from Breach 6. Content Liability Intellectual Property 7. Data Loss in Transit Most States have laws regarding the reporting and investigation of Cyber Breaches .www.intlbondmarine.com

Cyber Coverage Cont. 8. Privacy Legal Liability 9. Regulatory Defense Costs 10. Fines & Penalties 11. Cyber Extortion Threat 12. Digital Restoration Costs Most States have laws regarding the reporting and investigation of Cyber Breaches Sue agreed to charge 10 bucks an hour for her services on this cocktail napkin .www.intlbondmarine.com

IB&M Cyber Risk Management Breach Prevention Plan Consultative Approach (Firewalls & Anti-Virus Software) Post Breach Hotline (Triage) Strength in Numbers (Latest Trends) . 1. Review your application to get the scope of your operation, type of data you collect, current security, breach plan. 2. Recommend steps to defend possible breach and sure up firewall With insurance, you have the power of collective insurance insights into the latest cyber trends and tools to prevent a breach. Hotline to call when breach occurs There are many misconceptions of what to do in the event of a breach to mitigate damage. Shutting your system down is not always the right move. .www.intlbondmarine.com

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