Cyber risk continues to evolve rapidly, and while many businesses now understand the importance of Cyber Insurance, not all policies are created equal.
For brokers, one of the biggest challenges is ensuring clients are not only purchasing cyber cover, but that they are properly protected against the exposures that can have the greatest operational and financial impact.
At FTA Insurance, we work closely with brokers to help provide broad, practical cyber protection designed to respond when clients need it most. Our recently launched Technology Risk product has also been a strong addition to the market, offering brokers a combined IT Liability & Cyber solution for technology-focused businesses seeking a more streamlined and comprehensive policy.
Below are five common cyber coverage gaps businesses often overlook, and how FTA can help address them.
1. Business Interruption Following a Cyber Event
Many businesses focus on data breaches and ransomware when considering cyber insurance, but often overlook the financial impact of operational downtime.
A cyber incident can result in:
- Lost revenue
- Interrupted operations
- Ongoing staff expenses
- Additional recovery costs
- Reputational damage
Some policies provide limited or restrictive business interruption coverage, particularly where outages involve third-party providers or preventative shutdowns.
FTA's Technology Risk policy includes cover for:
- Business Income loss
- Restoration Expenses
- Business Continuity Expenses
- Dependent Business Interruption
- Reputational Harm
- Voluntary Shutdowns (preventative shutdowns)
This helps provide clients with broader protection against the real financial consequences of a cyber event.
2. Third-Party Provider Exposures
Many businesses now rely heavily on cloud providers, software vendors, payment platforms, and managed IT providers.
A growing exposure in today's environment is not necessarily a client's own systems failing, but rather the failure of a third-party service provider they depend on.
Some cyber policies contain limitations around outsourced providers or contingent business interruption exposures.
FTA's Technology Risk policy includes cover for Dependent Business Interruption arising from Network Interruption Events impacting a Service Provider's computer systems, helping brokers provide stronger protection for clients operating in increasingly interconnected environments.
3. Regulatory Investigations & Privacy Penalties
With privacy regulation continuing to tighten in Australia and globally, businesses are becoming increasingly exposed to:
- Regulatory investigations
- Legal defence costs
- Privacy-related penalties
- PCI expenses
A common misconception is that cyber policies only respond to data recovery costs or ransomware events.
FTA's Technology Risk wording includes cover for:
- Privacy Regulatory Defence Costs and Penalties
- PCI Expenses and Penalties
- Third Party Privacy Liability
- Defence Costs arising from cyber-related claims
This can provide valuable support for businesses navigating increasingly complex regulatory obligations following a cyber incident.
4. Social Engineering & Cybercrime Losses
One of the most common cyber claims impacting SMEs today involves social engineering fraud, phishing attacks, and fraudulent fund transfers.
Businesses are often surprised to learn that traditional crime or cyber policies may contain significant limitations around cybercrime-related financial loss.
FTA's Technology Risk policy includes Cybercrime Cover for losses arising from Cybercrime Events, helping brokers better protect clients against increasingly sophisticated fraud tactics.
In addition, the policy also includes Cyber-Extortion and Ransom Cover, including reimbursement for Cyber-Extortion and Ransom Expenses where legally insurable.
5. Technology Businesses Needing Both IT Liability & Cyber Cover
Technology companies often face a dual exposure:
- Professional liability arising from the services or products they provide, and
- Cyber exposures impacting both themselves and their clients.
A common gap occurs where businesses hold separate policies with differing wordings, inconsistent cover triggers, or gaps between PI and Cyber coverage.
FTA Insurance recently introduced our Technology Risk product specifically to address this challenge, combining:
- Professional Liability
- Public & Products Liability
- Cyber Liability
into one streamlined solution designed for technology businesses.
The product has been very well received by brokers looking for a practical and comprehensive combined IT & Cyber policy solution for their clients.
Additional benefits available under the wording include:
- Multimedia Liability
- Employee Dishonesty
- Intellectual Property Infringement cover
- Mitigation Costs
- Public Relations Expenses
- Inquiry Costs
- Contractual Liability extensions
- Continuous Coverage provisions
This broader approach can help reduce potential grey areas between policies while providing clients with greater confidence and peace of mind.
Final Thoughts
As cyber threats continue to evolve, brokers are increasingly being asked not just whether a client has cyber insurance, but whether the cover is actually fit for purpose.
Understanding common cyber coverage gaps can help brokers have more meaningful conversations with clients around operational resilience, business continuity, and emerging technology exposures.
FTA Insurance's Technology Risk product was designed with this in mind, helping brokers provide clients with a broad and practical combined IT & Cyber solution backed by strong coverage and real-world responsiveness.
For brokers wanting to learn more about FTA's Technology Risk offering, please contact the FTA team.