The system or web site is thereby rendered inoperable unless and until the lost, damaged, or corrupted data is restored or replaced. However, we have a hunch that most insurers will not recognize coverage for time element losses related to such viruses. Although insureds have arguments to rebut such a position and to argue otherwise for coverage of their loss, until such coverage issues are resolved by the courts, sound risk management should treat it as an issue that needs to be expressly addressed in an insurance program, if for nothing more than to confirm that the insurer's intent conforms with the insured's expectations of coverage. Another risk with respect to commercial property policies deals with employee dishonesty. Most commercial property policies contain an exclusion for loss caused by employee theft.
Some policies even exclude loss caused by employee malicious destruction.
Even with this latter provision removed, the policy still will exclude loss caused by employee theft. Insureds may not think that is a problem, because employee theft losses are covered by commercial crime policies and fidelity bonds. However, such policies and bonds contain a time element loss exclusion. This means that while the property loss might be covered, the time element losses are not. This problem is discussed in more detail below.