Client Stories | September 10, 2021

Obtaining Cyber Liability Insurance Coverage Quickly

Early in the COVID-19 pandemic, an established third-party administrator (TPA) that prioritized security, but didn’t have a cyber liability policy, found itself in a potentially precarious position. One of its longstanding key clients announced a requirement that vendors have that coverage.

Two Businessmen Working Together On A Computer In A Modern Office

The challenge

The TPA has always taken security seriously. It has strong controls in place and makes sure that its staff fully understands the risks inherent in lax procedures. Its computer systems have up-to-date virus protection. Moreover, the TPA has never experienced a breach of any kind. Consequently, management thought that it didn’t need to purchase cyber liability coverage.

That assumption was challenged when cyber criminals began to take advantage of businesses that allowed staff to work remotely during the pandemic. The news carried one story after another about the increasing number of attacks.  

The need for a cyber policy became critical when a major client declared that it would terminate its contract if the TPA did not have a policy in place within a month.

Our solution

The TPA first contacted the broker it used for property insurance and other coverages. That broker explained it could not secure a cyber policy within the one-month timeframe. A senior leader at the TPA, who had attended our Cyber Month webinars, reached out to us for help.

The Segal insurance broker who responded to the inquiry realized timing would be tight to secure quotes, even though they have not had any breaches and security at the TPA fit positive risk profiles. The TPA asked for more than one carrier option and was especially interested in carriers that offered effective risk-prevention tools for cyber clients.

With the year-end quickly approaching, Segal’s broker assisted the client in completing the application and gathered quotes within two weeks. One positive outcome of the pandemic has been greater acceptance of virtual meetings; the broker was able to present to the TPA’s management team. The TPA was keen to discuss how various limits and deductible levels might affect both the cost and the protection offered by the policies being considered.

The results

The breadth of information and analysis our broker provided enabled the TPA’s management team to reach a decision quickly. By the end of day, and within hours after the presentation, management made a selection. The coverage binder was secured soon after — well within the original, seemingly impossible, one-month turnaround time. By obtaining cyber coverage by the client’s deadline, the TPA retained the client.

Want to learn more?

Leave your contact information and one of our professionals will reach out to start a conversation.

We value your privacy. We'll never share your data with anybody.

See more insights

Businesswoman Working On Laptop At A Cafe

Cybersecurity Tasks to Protect Data & Meet High Expectations

Be prepared for a possible data breach. See our checklist of eight annual tasks that can help protect your organization's data.
Young African Woman Using A Laptop In A Server Room

Vendor Cybersecurity Best Practices for Plan Sponsors

Cybersecurity is an increasingly critical issue. Protect your plans and take steps to reduce risks.
Female IT Engineer In Data Center

Data Retention Policy: Follow Through to Stay Secure

Review your data retention process and ensure that your data is secured.

This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.

Don't miss out. Join 16,000 others who already get the latest insights from Segal.