Insurance industry officials said their business is doubling every six to 12 months, as worries about hacking increase and more information technology professionals realize their companies' standard insurance policies don't cover risks incurred by their Internet-based businesses. Although AIG's assessment is free, some competitors expressed skepticism. John Wurzler, chief executive and founder of J.S. Wurzler Underwriting Managers, which specializes in Internet-related risks, said AIG's offer may create a false sense of security among insurance buyers. He requires the companies that his firm insures to do monthly security checkups. What's Covered Companies interested in hacker insurance can buy coverage either as a package or la carte.
Some policies only pay for risks associated with loss or misuse of intellectual property.
Others cover liability for misuse of a company's site by a third party, or damage caused by an outside hacker. Premiums are generally based on a company's revenue, as well as the type and amount of coverage being sought. Given the range of costs and coverage, industry officials warn potential buyers to be wary. Some policies cover only the amount of net income lost due to hacking. A better choice for some companies may be coverage for lost revenue.