New third-party policy offers coverage of up to €20m
Allianz Global Corporate & Specialty (AGCS) has launched an updated version of its third-party technology professional indemnity (PI) product.
The company has updated the policy in response to the increased volumes of data companies are storing and the rapid increase in internet traffic.
The policy provides cover of up to €20m (£16.6m).
AGCS technology PI underwriter James Tuplin says the new policy wording uses breach of contract as the main trigger for payout rather than the previous triggers of civil liability or professional negligence.
The trigger change means the new policy wording is simpler. The previous triggers depended more on historical case law to prove a covered event had taken place. But Tuplin says breach of contract is easier for insureds to prove, making it easier to define in the wording what will be covered.
Tuplin told Insurance Times: “It’s very difficult to match up new cases to old cases, which makes court cases very lengthy.
“And it makes it difficult as an insurer to know if you are offering the cover that the client needs, because until it goes to court you cannot actually prove the theory.
“As an underwriter it becomes difficult to know how big a claim will be, because you will need to do a lot more digging into the case or there may be no existing case law.”
The new policy will still cover negligence and civil liability as before.
New additions to the coverage include ‘failure to access’, where a client may be unable to access a service provided by the insured, and ‘failure to deny access’, where a company has failed to stop a client’s database or account from being hacked.
Along with third-party PI cover, the new technology policy will also include most elements of cyber cover including first-party cover against the loss of data or a breach by hackers. However, it does not include non-physical damage business interruption.
Clients on the old wording will be upgraded to the new wording if they choose, while new clients will automatically get the updated PI wording.
Tuplin said: “A traditional product is no longer fit for purpose as specialist wording is required, especially in a world where a new app or piece of technology is launched every day.”