Cyber Insurance Challenges Highlighted by Court’s Denial of P.F. Chang’s Claim

How far will cyber insurance coverage stretch when there is a breach? Courts are starting to answer this question as cyber insurance policies get tested with breaches. While these policies are marketed as “a panacea for all cybersecurity-related woes,” when policyholders face significant losses, the insurers “hire high-powered lawyers” to avoid paying claims, Scott Godes, a partner at Barnes & Thornburg, told the Cybersecurity Law Report. We analyze the recent district court ruling that a cyber insurance policy fails to cover liabilities to credit card issuers arising from a popular restaurant’s data breach. See also “Building a Strong Cyber Insurance Policy to Weather the Potential Storm”: Part One (Nov. 25, 2015); Part Two (Dec. 9, 2015).

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