Comparing Cyber Policies

Real Estate Firms Need Real Estate Specific Cyber Coverage

Cyber insurance is very complicated. Even experienced insurance brokers have difficulty understanding the intricacies of this new product. Many are selling Cyber policies to real estate firms that use terms that make it sound like wire transfer fraud is covered, when in reality it is not.

Most Cyber policies are designed to cover attorneys, accountants, tech companies, etc. that are not structured like real estate firms. The use of independent contractors (with their own computers and networks) and money being controlled by others (client, escrow, title, etc.) is unique to real estate. If the policy does not properly address these differences, you may be uncovered. We created this page to help you understand what to look for when comparing policies.

How to Compare Cyber Policy Coverage:

It is important to understand the terms used in cyber policies. Here are the most common:

Computer Breach: Using malicious software and/or stolen login information to access data in a computer or cloud based software like email or DocuSign.

Contractors vs. Employees: Does the policy cover contractors (licensees) or just employees? A major Association is endorsing a policy that only covers owners and employees, potentially exposing firms to uncovered losses if a licensee of the firm has a breach or other Cyber incident. Read the policy, don't rely on ads.

Personally Identifiable Information (PII): Personal information like date of birth (D.O.B), social security number (SSN) that can be used to commit identity theft. Make sure the policy does not require theft of a SSN, D.O.B., or other information not normally collected during a real estate sales transaction.

Social Engineering/Phishing: Impersonating a trusted source, like an escrow officer, the government, bank, etc. to gain personal information or passwords.

Wire Transfer Fraud: Impersonating a title or escrow officer, lender, etc. and providing false wire instructions that results in the misdirection of funds.

Cyber policies have custom policy language, so every policy is different. You need to know the basic language and what to look for to make an accurate comparison. This will provide you with some basic questions to ask to confirm the policy covers what you need.

Coverage Name What It Does What to Ask Realty Cyber Policy
Named Insured or Insured Explains who is covered like the firm (Named Insured) and those at the firm (employees, independent contractors, etc.). Are independent contractors covered (licensees), or just employees? Covers employees and independent contractors controlled by you.
Liability Pays for attorney fees and damages due to negligence, like a computer breach, resulting in the theft of funds, or Identity Theft from stolen PII, etc. What triggers coverage? Just a suspected security breach, or the actual theft of PII? Provides coverage due to an actual OR suspected system breach.
First Party Losses Covers losses of an Insured, like theft of the firm’s funds due to wire fraud or social engineering. Does not cover client funds. Is social engineering or wire fraud of my company’s funds covered? If so, how much? Our eCrime covers company losses up to the limit for wire fraud, social engineering, etc.
Third-Party Liability Covers damages and/or losses owed to others due to negligence like a data breach. May cover wire fraud or social engineering if the breach led to theft of client funds. What triggers Third-Party liability a suspected breach or theft of PII? Third-Party liability is triggered by a breach, or suspected breach. Theft of PII is not required.
PII-Personally Identifiable Information This is the type of information that needs to be compromised to trigger coverage in some policies. What type of PII needs to be taken, just names/phone numbers or SSN, DOB, etc.? Our policy just needs a cell phone number to be compromised.
Crime Coverage Does not require a system breach or stolen PII to cover funds of the firm or their client that the Insured accidentally sends due to social engineering, wire transfer fraud, or other cyber fraud. Does it cover client funds like Broker Held Escrow, Property Management deposits or repairs paid to vendors, etc.? Our eCrime reimburses the loss of your, or client funds due to wire transfer fraud, social engineering, etc.
Multimedia Liability Covers copyright infringement, libel, slander, etc. Is Multimedia Liability part of the policy? Yes. Full policy limits.

                                                           Still confused? We get it! Cyber is the most confusing insurance available. But we are here to help!

                  Send us a copy of your current policy and we will be happy to review it to confirm it covers your needs. Email it to info@realtycyber.com. 

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