8 ADJUSTINGTODAY.COM As for cyber insurance, the “property” to which coverage applies is not entirely clear or standardized. Traditional concepts of insured property and insured locations are often not relevant to losses that are largely intangible. In some cyber policies coverage extends only to data that is corrupted or breached. Sometimes there is no need for any “damage” at all, tangible or intangible, to trigger a network disruption and a covered income loss. In other cyber policies, however, coverage may extend to physical damage to a computer network, from internal and/or external perils, as well as the corruption, loss or exposure of data. Cyber policies often exclude income coverage for losses arising from property and equipment breakdown perils, although the wording of the exclusionary provisions is inconsistent. Each of the three types of business income coverages include some type of waiting period and/ or dollar deductible, which can vary greatly due to the different types of losses. The standard ISO BI form includes a built-in 72-hour waiting period deductible for income coverage, with an option available for allowing coverage to kick in 24 hours after a suspension of operations. The waiting period deductible for equipment breakdown income coverage is often established to coincide with the property deductible. Indeed, many carriers allow equipment breakdown to be Summary of provisions in proprietary cyber insurance coverage forms Typically has its own aggregate limit(s), sometimes subject to hourly and coverage sublimits. Time-element deductible typically included; commonly lasting less than a day and expressed in hours. Where included, dollar deductibles are typically indicated on the declarations. Not commonly subject to coinsurance. Limits and Deductibles Table entries are paraphrased summaries and not authoritative. Actual claims must be adjusted on the basis of specific wording in applicable policies. ISO CP 00 30 Business Income (and Extra Expense) Coverage Form A single limit for BI-EE coverage established in the declarations. Automatic 72-hour waiting period deductible unless amended by endorsement or dec page entry. Coinsurance percentage indicated in the declarations. Coinsurance does not apply if coverage is subject to a maximum period or monthly limit of indemnity; coinsurance is suspended for 12 months under agreed value coverage. HSB Equipment Breakdown Coverage Form 6671 All income and extra expense coverages subject to separate declared sublimits that fall under the general equipment breakdown limit established in the declarations. If indicated in the declarations, deductibles can be dollar, time, multiple of average daily value, or percentage of loss. Multiple deductibles can apply to any one accident, unless a combined deductible is indicated in the declarations. Coinsurance applies separately to each insured location according to a formula established within the policy. Policy limits Deductible(s) Coinsurance
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