Cyber Insurance 101: Coverage Issues Related to Cyber Attacks and Cyber Insurance
The Rise of Cyber Attacks
On October 3, 2013, Adobe Systems Inc., the computer software giant responsible for staple software products such as Adobe Acrobat and Photoshop, announced that its security team had discovered a "sophisticated attack" on its networks, resulting in the exposure of personal information, including the names, passwords, and encrypted credit and debit card numbers, of over 2.9 million Adobe customers. In the weeks following the announcement, this initial estimate quickly ballooned to over 150 million, making the breach the largest (in terms of the number of records stolen) publicly disclosed cyber attack to that date. Although Adobe reported that the vast majority of the compromised records were inactive or ficticious accounts, the company set out to notify at least 38 million active users and tens of thousands of inactive users, as well as related banks and credit card companies, that their data had been compromised.
This article was originally presented at the March 2014 ABA Insurance Coverage Litigation Committee CLE Seminar in Tucson, AZ.