Forwarded From: William Knowles <erehwon@kizmiaz.dis.org>
[Inter@ctive Week] (7.13.98) An Atlanta-based insurance company is daring
to go where others have feared to tread, by offering insurance against
hacker attacks to companies involved in electronic commerce.
The policy, from Network Risk Management Services Inc., is believed to be
the first to offer protection against third-party liability claims
resulting from breaches in computer network or Internet Web site security.
Other insurance and security companies may not be far behind, however,
drawn by potentially lucrative rewards. IBM Corp. confirmed that it is in
talks with a major insurance player and is nearing an announcement of its
own.
The NRMS policy, called InsureTrust, covers losses or claims that might
arise from the theft of data, including corporate or personnel
information, misuse of that data and attacks that result in denial of
service.
"There has been a huge gap in the availability of insurance for breach of
security, and that has held many organizations back from developing
complex electronic commerce services," said Steven Haase, chief executive
officer of NRMS.
NRMS is a subsidiary of Hamilton, Dorsey, Alston Co., an Atlanta-based
insurance firm.
Haase acknowledged that offering insurance against liability claims
carries tremendous risks because the extent of potential losses isn't
known. However, he said, NRMS has put controls in place to limit the risk.
Companies applying for a policy must go through a security risk assessment
and comply with any recommendations put forward. NRMS could not provide a
price range for policies.
ICSA Inc., a Carlisle, Pa.-based security firm, began offering a variation
of insurance to its customers last month. ICSA now offers a TruSecure
package, which will pay clients up to $250,000 if a network that has been
certified by the firm has been breached. Because a broker must be licensed
to offer insurance, TruSecure is described as an "assurance" policy.
-o-
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Received on Sat Jul 18 12:29:59 1998