Equifax Insurance ‘inadequate’ against cyber breach

Bloomberg

Equifax Inc.’s insurance against cyber breaches is likely inadequate to cover the credit-reporting company’s costs tied to one of the biggest hacks in history, according to people familiar with the coverage.
The company holds a policy that would probably cover about $100 million to $150 million, with costs shared by carriers in the London market and elsewhere, said the people, who asked not to be identified discussing a private contract. Though Equifax’s eventual expense may not be known for years, it could be multiples higher than the insurance payout, given what the company has disclosed and the costs at hacking victims like Yahoo and Target Corp., they said.
“Equifax carries cybersecurity, crime, general-liability and other lines of insurance, and we have begun discussions with our carriers regarding the incident,” a spokesperson said by email Saturday, without commenting further. The company has offered free credit-monitoring to victims after reporting that a breach affected 143 million people, revealing Social Security numbers, drivers license data and birth dates. The Atlanta-based company now faces multiple state and federal investigations, and a proposed multibillion-dollar class action lawsuit was filed against Equifax. In its annual report, the company addressed the limits of its insurance protection tied to cyber risks.