The Hartford Introduces Data Privacy Coverage For Technology Companies
DJ Press Release Wire
10:22 AM Eastern Daylight Time Mar 10, 2009
HARTFORD, Conn.--(BUSINESS WIRE)--March 10, 2009--
While large-scale data security breaches are those that make news, a breach of any size can be costly for software developers, hardware firms and other technology companies that have non-public personal information in their control. Data breach laws in many states require notification and credit monitoring services for those affected, the costs for which are incurred by the company responsible for the breach. With the average per-record cost of a data breach at $202, according to a 2008 Ponemon Institute study, the cost of a breach involving just 500 records could exceed $100,000.
To address this exposure for technology firms, The Hartford Financial Services Group, Inc., (NYSE: HIG) one of the nation's largest financial services companies, has added First Party Data Privacy Expense coverage, along with Cyber Extortion Expense coverage, to its FailSafe(R) suite of technology liability coverages. These new coverages are offered as an endorsement to the FailSafe GIGA(R) and FailSafe TERA(R) policies.
"Many technology companies are at risk for improper dissemination of non-public personal information or violation of data privacy laws. This endorsement is designed to address direct costs that would not be covered by third party technology professional liability coverage," said David J. Selembo, assistant vice president of professional liability, underwriting & operations for The Hartford's Technology Practice Group, which provides insurance coverage tailored to the risks of technology firms.
The Hartford's Data Privacy Expense coverage pays for actual expenses incurred as a result of a policyholder's negligent acts, errors or omissions that result in the improper dissemination of non-public personal information, or a breach or violation of data privacy laws. Specific components of the coverage may include:
1. Notification expenses incurred to comply with notification laws.
2. Crisis management expenses incurred for fees and costs associated with hiring a crisis management firm to perform services that minimize potential harm and maintain or restore confidence in the policyholder.
3. Data privacy regulatory and credit monitoring expenses incurred in connection with a statutory mandate requiring credit monitoring for third parties in compliance with data privacy laws, legal expenses in defense of a data privacy regulation proceeding, and certain fines or penalties, where insurable, in connection with a data privacy regulation proceeding.
4. Cyber investigation expenses incurred to have a third party investigate the policyholder's computer system to determine the source of a data privacy breach.
The Hartford's Cyber Extortion Expense coverage addresses expenses incurred by a policyholder in the event of an extortion threat to cause an actual interruption, suspension, or failure of the company's computer system, including the failure to prevent unauthorized access or unauthorized use of the computer system.
To learn more about The Hartford's FailSafe suite of customized solutions for the technology industry, agents and brokers should contact david.selembo@thehartford.com, their local Hartford sales representative or a Technology Practice Group underwriter.
About The Hartford
The Hartford is one of the nation's largest financial services companies and a leading provider of investment products, life insurance and group benefits; automobile and homeowners products; and business property and casualty insurance. International operations are located in Japan, the United Kingdom, Canada, Brazil and Ireland. The Hartford's Internet address is www.thehartford.com.
