Brokers at risk due to lack of cyber insurance uniformity

Every insurance carrier likes to put its own unique stamp on a product line. Whether it’s ‘the lowest premiums in the marketplace,’ or ‘the broadest coverage in the marketplace,’ the key aim is product differentiation. This can be both a boon and bane for insurance brokers. The benefits are obvious in that brokers are able to find the best possible coverage for their clients, but brokers also face dangers when dealing with policies that lack uniformity in nature.

One area where brokers are increasingly exposed to errors and omissions is Canada’s burgeoning cyber insurance market. Lisa Armstrong, managing partner at Strigberger Brown Armstrong LLP (SBA), explained: “As the cyber insurance market in Canada continues to grow, I think we’ll likely see an uptick in claims against insurance brokers – and that’s simply because the coverages offered and the policies written are not uniform. If a client doesn’t get the coverage they thought they wanted or thought they were buying, that could result in claims against brokers. I, personally, haven’t seen any of these claims yet, but it’s easy to imagine there could be…