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Companies buying more insurance against cyberattacks

- The Washington Times - Thursday, March 14, 2013

The number of U.S. companies buying insurance to cover the costs of potential cyberattacks and data breaches rose by a third last year at insurance broker Marsh Inc., making it one of their fastest-growing lines of coverage, Dow Jones News Service reported Thursday.

Businesses that purchase cyberattack coverage are getting more, Marsh said in a report: The average customer bought $16.8 million insurance against cyberattacks last year, an increase of nearly 20 percent from 2011.

With alarming news about cyberattacks dominating the news in recent cycles, the insurance broker's report is the latest sign that corporations are becoming more concerned about the reputational and financial damage they can suffer when their systems are hacked.

Insurance companies and brokers have been trying to sell add-ons to standard commercial insurance policies to cover such risks for more than a decade, but they have gained traction with the product only in recent years, Dow Jones reported.

"From the guys managing the help desk to the board, they're now all aware of the risks," said Bob Parisi, network-security and privacy-practice leader for Marsh, a unit of Marsh & McLennan Cos. "It's one of the fastest-growing lines of insurance out there," he told Dow Jones.

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