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Oct 14
Why Cyber Liability ‘Pay on Behalf of’ Provisions Matter

When reviewing cyber liability policies, whether the carrier will “pay on behalf of" or “indemnify" is a significant feature your clients should consider when selecting cyber liability coverage.

Under an “indemnity" provision, the policyholder is subject to paying damages and defense up front—out of their own funds—and must then seek reimbursement from the carrier. According to Coalition's H1 2021 Cyber Insurance Claims Report, the average ransom demand increased 170%, exceeding $1 million in the first quarter of 2021.

If your clients choose a policy with an indemnity provision for ransomware coverage, clients should consider if they have the assets to pay for damages out of pocket before being reimbursed by the carrier.

Many cyber policies apply “pay on behalf of" provisions to certain coverages but may only “indemnify" for others, such as breach response costs, cyber extortion or ransomware.

Coalition's policy is among the few policies in the market applying "pay on behalf" across every single coverage. At a time when cash is especially precious, policyholders never have to pay losses or claims expenses out of pocket. Policyholders also benefit from free breach response services, a 24/7 in-house incident response team, and free cyber security tools—all industry firsts!

Coalition's cyber liability products can be quoted and bound through Big “I" Markets, the online market access system available exclusively to Big “I" members. Direct access to Coalition's underwriters and renowned cybersecurity experts is provided to Big “I" Markets registered agents via online chat throughout the sales and underwriting process. Sales and educational resources include client-ready marketing, declination form, sample solicitation letter, claim examples and case studies, claim and limit calculators, pre-recorded cyber liability and cybersecurity training videos, and more.

Coalition is admitted in many states, providing agents with a one-stop shop to place cyber liability coverage for small businesses as well as the most complex risks in the surplus arena. Limits up to $15 million are available to U.S. risks generating less than $1 billion in revenue/gross profit. 

Learn more about Coalition via Big “I" Markets or schedule a call with Carla McGee, cyber program manager. 


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Alexandria VA 22314
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fax: 703.683.7556

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