Rising Cost of Homeowners Insurance

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Photo by Pegleess Barrios from Burst

Many people can expect their homeowners insurance rates to go up this year—along with the rising cost of materials and supplies—in this economy.

Several factors are behind the rising costs. Severe weather events continue to cause serious damage and costly insurance claims. The rising cost of building materials, supply chain issues and unfilled jobs are driving up the costs of home repairs.

In this article, we’ll explain some key factors causing home insurance rates to rise and what you can do to help rein in your costs.

What are some key factors driving up home insurance rates?

Extreme weather events and catastrophes

Hurricanes, floods, droughts, wildfires and other severe weather events have become more frequent, destructive and contributing to rising costs. As of October 11, 2022, the United States sustained 15 weather events with losses exceeding $1 billion each.1 As weather-related damages go up, so does the cost of insurance overall. Insurers typically adjust rates on a state-by-state basis based on actual and anticipated weather-related losses.

Rising cost of materials

Another key consideration when pricing homeowners coverage is the cost to repair or rebuild a home in the event of a loss.
Limited supplies and inflated prices for most building materials continue. Consider this sampling of price increases between October 2021 and October 2022:

  • Material goods for new residential construction rose 14.3%.2
  • Lumber and wood products went up 6.2%.3
  • Asphalt roofing materials grew 14.5%.4
  • As building costs go up, so does the cost to repair or replace homes damaged by covered losses.

Skilled labor shortage

The construction industry is facing a skilled labor challenge, which has resulted in added expenses related to wages, supply chain problems and other construction issues.5 This sector had 423,000 job openings as of September 2022,6 more than twice the projected number of annual openings.7

Factors impacting your homeowners rate you may be able to control

Current market conditions that affect the rising cost of your insurance premiums may be out of your control, but there are steps you can take to help keep the cost of your homeowners coverage in check.

  • Install protective devices. To help avoid losses and save money, ask your insurance agent about any savings you might qualify for by taking preventive measures to protect your home. For example, Travelers offers insurance premium discounts for smoke detectors, fire alarms, water sensors, interior sprinkler systems and smart home protection devices.
  • Review your insurance. Ask your agent to review your current coverage to ensure you’re getting the customized protection you need. Make sure all home improvements are accounted for. Cancel or reduce coverage you no longer need.
  • Increase your deductible. A higher deductible will likely reduce your premium. Just remember to have enough savings to cover your deductible should you experience a loss.
  • Bundle your policies. Travelers offers discounts when you purchase more than one policy with them. Home and auto are commonly bundled for a discount, but discounts may also apply to boat, valuables, personal umbrella protection and other specialty coverages. Learn about the multi-policy insurance discounts that Travelers offers.
  • Explore customer retention programs. Travelers offers premium discounts, or credits to long-term customers. For example, the Travelers Decreasing Deductible®* program applies a $100 credit each year toward your deductible. This credit is earned at your annual renewal date even if you have a loss.

*Travelers Decreasing Deductible is not available in all states, including California.

Current market conditions are challenging. Catastrophic weather events are on the rise. Pandemic-era disruptions, including shortages in building materials and skilled labor, are driving rate changes. But there are factors within your control when it comes to the premiums you pay. It’s smart to take advantage of them.

Travelers Why Homeowners Insurance Premiums are Rising and What You Can Do

https://www.travelers.com/resources/home/insuring/why-did-my-homeowners-insurance-go-up

Sources

1 https://www.ncdc.noaa.gov/billions/ 
2 U.S. Bureau of Labor Statistics, Producer Price Index by Commodity: Inputs to Industries: Net Inputs to Residential Construction, Goods, October 2022
3 U.S. Bureau of Labor Statistics, Producer Price Index by Commodity: Lumber and Wood Products, October 2022
4 U.S. Bureau of Labor Statistics, Producer Price Index by Commodity: Asphalt Felts and Coatings, October 2022
5 https://www.agc.org/news/2022/08/31/construction-workforce-shortages-risk-undermining-infrastructure-projects-most-contractors-struggle-0
6 U.S. Bureau of Labor Statistics, Job Openings: Construction, September 2022
7 U.S. Bureau of Labor Statistics, Construction Laborers and Helpers, September 2021 

1 https://www.ncdc.noaa.gov/billions/ 
2 U.S. Bureau of Labor Statistics, Producer Price Index by Commodity: Inputs to Industries: Net Inputs to Residential Construction, Goods, October 2022
3 U.S. Bureau of Labor Statistics, Producer Price Index by Commodity: Lumber and Wood Products, October 2022
4 U.S. Bureau of Labor Statistics, Producer Price Index by Commodity: Asphalt Felts and Coatings, October 2022
5 https://www.agc.org/news/2022/08/31/construction-workforce-shortages-risk-undermining-infrastructure-projects-most-contractors-struggle-0
6 U.S. Bureau of Labor Statistics, Job Openings: Construction, September 2022
7 U.S. Bureau of Labor Statistics, Construction Laborers and Helpers, September 2021 

Why Are Auto Insurance Rates Rising?

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Car rising up bills

Increasing auto insurance premiums have been troubling for policyholders and their wallets. According to statistics released in May 2023 by the U.S. Department of Labor, auto insurance premiums increased 17.1% in the previous 12 months. Although the cost of insurance may change each year for various reasons, this infographic can help shed light on current market factors influencing policies across the country right now:

Vehicle inventory—While the availability of new cars has rebounded since the COVID-19 pandemic, inventory levels overall are still below average, and prices for used vehicles remain relatively high. As cars remain more costly, insuring them may be more expensive.

Higher repair costs—Inflation, supply chain issues lingering from the pandemic, high demand at auto shops and a car technician labor shortage have contributed to increased repair costs and the related price of auto insurance claims.

Rising medical bills—As health care costs have risen, auto insurance companies must pay more for medical services from MedPay and personal injury protection (PIP) coverage. Consequently, premiums have also increased.

Increased claims—Car accidents and thefts have become more common in recent years, leading to more claims being filed against auto policies. As the number of claims rises, so too does the cost of insuring against them.

In response to rising auto insurance premiums, policyholders should consider the following ways to save on their rates:

  • Stay safe – Avoid blemishes on your driving record by practicing safe habits behind the wheel.
  • Take courses – Completing driving safety courses may unlock discounted premiums.
  • Bundle coverage – Purchasing multiple types of coverage from the same insurer may reduce overall costs.
  • Maintain good credit – High credit card balances, late payments and other negative effects on a policyholder’s credit score may lead to higher premiums.
  • Reconsider policy details – Adjusting your coverage, such as increasing your deductible, may help limit premiums.
  • Drive less – Insurers may consider how far a policyholder drives annually. By reducing mileage and reporting accordingly, costs may be decreased.

Even among increased rates, auto insurance remains a critical loss control measure for U.S. motorists. Insufficient coverage could lead to legal noncompliance penalties and, in the event of an accident, catastrophic out-of-pocket costs.

Contact us today to learn more about potential auto insurance discounts and other ways to save on your premiums.

Spring Storm Preparedness

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As spring approaches, it brings with it the possibility of a major spring storm, which can cause severe weather events like thunderstorms, lightning, hail, and even tornadoes. It is essential to be prepared and safeguard both property and personal safety. Here is a concise guide on how to prepare for the unpredictable weather of the season.

Review Your Insurance Coverage

Begin by reviewing your home insurance policy to ensure it covers damages caused by storms. It is crucial to understand the specifics of your coverage, including how to file a claim, before the spring storm season arrives. If you have any questions or need adjustments to your policy, please contact us for a detailed review.

Secure Your Home

  • Outdoor Items: Secure or store outdoor furniture and decorations to prevent them from becoming windborne hazards.
  • Roof and Gutter Check: Inspect your roof for damages and clear gutters and downspouts to prevent water damage.
  • Emergency Kit: Assemble an emergency kit with essentials like water, non-perishable food, a flashlight, batteries, and a first-aid kit.
  • Power Outage Plan: Prepare for potential power outages with supplies and consider investing in a generator for extended blackouts.

Stay Safe

  • Stay Updated: Monitor weather forecasts and spring storm alerts through a reliable weather app or NOAA Weather Radio.
  • Identify Safe Spaces: Know the safest area in your home to take shelter during a storm, such as a basement or an interior room without windows.
  • Practice Safety Plans: Conduct regular drills so all household members know the safety plan.

After the Storm

  • Assess Damage: Safely assess and document any property damage with photos and detailed notes. This information is vital for your insurance claim.
  • Prompt Claim Reporting: Contact us as soon as possible to report damages and initiate the claims process.

Conclusion

Spring’s arrival brings with it the need for vigilance and preparedness against a major spring storm. By taking proactive steps now, such as reviewing your insurance coverage, securing your home, and planning for emergencies, you can significantly reduce the risks posed by these unpredictable weather events. Remember, we’re here to assist, from policy review to claim support. Stay safe and make this spring season both enjoyable and secure.

Water Damage Safety Tips

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water damage to floor in home

Whether it’s the result of a leaky appliance, burst pipe, or destructive storm system, even a small amount of unwelcome water in your home can lead to thousands of dollars in damages within hours. We hope the information provided here will help you understand where water damage in your home is likely to start and how you can possibly identify minor issues before they become major problems.

6 Common Causes of Water Damage in Homes

  • Plumbing-related losses, e.g., frozen or burst pipes
  • Drain line issues, e.g., blockages or breaks
  • Roof leaks
  • Water heater failures
  • Sump pump overflows and municipal sewer backups
  • Appliance-related breakdowns

Telltale Signs You May Have a Water Leak or Damage in Your Home

  • Trickling, dripping, or running water sounds
  • Musty odors
  • Cracking, peeling, or bubbling paint or wallpaper
  • Water stains on ceilings or walls
  • Mold or mildew growth
  • Warped Floors or ceilings
  • Puddles under or around pipes

10 Steps You can Take to Prevent Water Leaks and Damage

With the following list in hand, take a walk around your home. If you answer no to one or more of the questions below, it may be wise to contact a licensed professional to help you better protect your property from water damage.

  • Protect the Pipes-Are all pipes on external walls or in unheated places insulated? Can you relocate vulnerable pipes to heated spaces? Do you shut off your water supply to exterior water spigots and drain them prior to winter months? Have you upgraded to frost-free exterior spigot lines?
  • Seal Any Gaps-Are all cracks and holes sealed, especially those where water pipes and electrical cords come in and out? Are all rubber seals and hoses connected to appliances secure with no signs of wear and tear?
  • Maintain Appliances-Is grime or buildup removed from the refrigerator coil, dishwasher filter, and washing machine drain regularly? Did a licensed professional install appliance water and gas lines? Do you know when your hot water heater warranty expires? Have you considered changing the anode rod?
  • Clear Gutters and Downspouts-Are leaves and debris scooped out and is water flow good? If you spotted a leak, has it been fixed with waterproof sealant? Are all gutter hangers firmly attached?
  • Inspect the Roof-Do you frequently check your roof for loose or missing shingles and damaged soffits? Are tree limbs cut back from the roof’s surface? Have you checked for signs of wear at the roof connection point for chimneys and vent pipes?
  • Safeguard Septic and Sump Pumps-Does your system have a backflow prevention valve to protect against overflow or clogs? Do you have a backup sump system or alternate power source if electricity gets knocked out?
  • Install Sensors and Alarms-Are leak detectors near all water-use appliances, under sinks, and in bathrooms, crawl spaces, and the basement? Do you have temperature change alarms to detect sudden drops? Have you checked with your home security system provider to see if you can add these helpful sensors?
  • Landscape Smartly-Have you made “rain gardens” so water runs off the lawn and away from the foundation? Has your lawn been graded properly to ensure water runs away from the building? Are there trenches between your home and nearby plant beds?
  • Know How to Stop Water Flow-Does everyone in your home know the location of the main water shutoff valve, and is it easily accessible? If your gate valve looks corroded, have you considered having a licensed plumber change it to a ball valve style? Is your shutoff valve connected to leak and temperature sensors?
  • Have an Away-From-Home Plan-Do you shut off water supply to appliances while traveling? If there is a water emergency while you are on a trip, does a family member, friend, or local licensed professional have access to your home? If you’re traveling for an extended period or relocat- ing temporarily for the winter season, do you consider shutting off your heating system and draining your pipes?

Click below to view a copy of the article

https://www.clearyinsurance.com/wp-content/uploads/Water-Damage-Information-Sheet-Andover-Companies-Updated-2.pdf

Rate Increases on Personal Auto

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rate increase Red toy car rides up a stack of coins

Seeking a return to profitability after a few years of underwriting losses, U.S. private passenger auto insurers continue to issue double-digit rate increases for drivers, according to a report from S&P Global.

Over half of the country has seen double-digit auto insurance rate increases.

The average premium has gone up 11% year-to-date nationwide, S&P revealed.

“The countrywide average will have increased by double digits in back-to-back years if this trend continues for the remainder of 2023,” the ratings firm added.

Among the top 10 personal auto insurers, USAA, Farmers Insurance and State Farm have implemented the largest effective rate changes year-to-date, with average increases of 14.9%, 14.2% and 13.9%, respectively. The top insurers with the lowest average increases so far are GEICO at 7.6%, Progressive at 8.5%, and Nationwide and Liberty Mutual at 8.8% each.

Rate increases vary widely by state, S&P noted. Nevada has had the highest overall effective rate increase so far at 27.9%, while rates in Idaho have increased the least at just 2.5% on average. In all, 32 states have seen double-digit increases.

Texas has the highest cumulative rate increase stretching back to January 2022, at 37.6% over the 20-month period. Seven other states have a cumulative effective rate increase of at least 30% since 2022. They include Illinois, Ohio, Tennessee, Nevada, Arizona, Illinois and Utah.

The states with the lowest cumulative increases are Hawaii (4.4%), Vermont (6.3%), North Carolina (8.2%) and California(11.1%). S&P noted that the cumulative rate increase in California is low “due to the almost two-year hiatus by the state regulator to approve any private auto rate increase.”

Rate-change data in S&P’s analysis is current through Aug. 18, 2023, and reflects 8.5 months of approved rate filings.

Key Takeaways

Even as insurance providers increase rates, consumers are looking for ways to reduce costs. Individuals are encouraged to discuss potential discounts with their insurance agents. Such deals may include reduced rates for good driving or bundling coverage.

While Cleary Insurance, Inc. cannot control insurance pricing, we can help you explore options for lowering rates without sacrificing essential coverage.

Contact us today to review your unique auto insurance policy.

The content of this News Brief is of general interest and is not intended to apply to specific circumstances. It should not be regarded as legal advice and not be relied upon as such. In relation to any particular problem which they may have, readers are advised to seek specific advice. © 2023 Zywave, Inc. All rights reserved

Lightning Storm Safety

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It is important to know what to do when a lightning storm is in your area, they are incredibly dangerous, with the potential to cause serious harm to you or your family. In fact, getting struck by lightning could cause severe burns, brain damage or even cardiac arrest. That’s why it’s crucial to be prepared and respond appropriately if a storm approaches your area. Here are some steps from the Centers for Disease Control and Prevention that you can take to protect yourself and your family when lightning strikes.

If you’re at home during a lightning storm

  • Make sure all windows and doors are shut.
  • Try to avoid using any plumbing features in your home (e.g., sinks or baths).
  • Don’t use any electrical equipment that plugs directly into the wall (e.g., a corded phone, computer or television).
  • Avoid resting on concrete floors or walls.

If you’re outside during a lightning storm

  • Get as close to the ground as possible without placing your hands or knees on the ground—never lay completely flat on the ground.
  • Avoid seeking shelter underneath trees.
  • Stay away from elevated areas—such as hills, cliffs or mountain ridges.
  • Get as far away from bodies of water or objects that could conduct electricity (e.g., wire fences or power lines) as possible.
  • If you are swimming, boating or fishing, seek shelter on land immediately.

If Someone Gets Struck

If someone you know is struck by lightning, contact 911 immediately. If you have the proper medical training, administer CPR to victims who do not have a pulse and treat conscious victims for burns, fractures and other wounds while you wait for help to arrive.

For more additional home safety guidance and homeowners insurance solutions, contact us today.

Inflation

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Prices are Through the Roof, Literally!

We’ve all seen the impact of inflation on energy costs, at the grocery store and now on your home and auto insurance. Although inflation seems to be settling, the impacts will be felt for years to come. With that being said, we’d like to provide you with some factors as to why you’re seeing such an impact to your home and auto insurance premiums.

  • Shortage of workers: The Home Builders Association estimates the number of hired construction workers needed to keep up with demand in 2023 will need to be 740,000, with an additional 2.2 million needed by 2024. This is also causing a spike in labor as contractors are paying more to attract talent.
  • Material costs: Costs are up 12% vs. 2022 and 40% since February 2020.
  • Safety Codes & Local Ordinance: Your homeowners policy provides coverage to bring out of date items up to code after a covered loss. Homes are rebuilt to current code to ensure the safety for you and your loved ones.
  • Loss of use: When you’re involved in a claim and unable to live in your home during construction, coverage that will pay for replacement living and rents are at an all time high.
Details of the cost of home repairs

Auto Inflation

Manufacturing time delays brought on by the pandemic have led to increased costs for parts, labor and rental vehicles. Below are a few statistics that have impacted auto premiums:

  • Technology: Cameras and sensors keep us safe and there’s an additional cost to ensure they are working properly after a collision. Some vehicles now have over 30 devices built into the car.
  • Parts: The average increase for parts was 10% in 2022, where in years past the average is typically 2 to 3%.
  • Supply Chain Issues: The delay in parts being available has increased the repair times by 5 days.
  • Replacement Vehicle Costs: Rental car costs have increased 30% since 2020.
  • Labor shortages: A decline in available skilled auto technicians has been declining and the industry is facing over 100,000 retirements in the coming years.
Factors driving auto insurance premiums

Rest assured, we’re here to provide assistance. There are opportunities for savings such as: bundling your auto and home insurance, raising your policy deductible, or capitalizing on discounts by implementing preventive measures like installing an automatic water shut-off or temperature monitoring system, to mention a few. Please contact us if you’d like to review your account further.

Reducing Winter Utility Bills

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Read more

Home Remodeling and Insurance

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You’ve hired a reputable builder, collected paint swatches and selected the siding and now you’re finally ready to start that long-awaited remodeling project. Before you begin construction, there is one more thing that you need to do—talk to Cleary Insurance, Inc.!

Advice for Do-it-yourselfers

If you decide to do it alone and manage a renovation yourself, you assume all the risks. A review of your homeowners coverage for liability and property is prudent, as you are assuming more risks and exposures than contemplated by homeowners insurance.

Hiring subcontractors who can provide you with a “Certificate of Insurance” or copies of their policies showing their general liability and workers’ compensation coverage is mandatory for your legal protection.

If a friend or relative helps out as a favor—no money changes hands—and gets injured, your homeowners insurance typically covers the cost of their injuries, up to your policy limits. It’s important to note that a homeowners policy is not designed to provide primary liability protection for these injuries. If a helper is seriously injured, the domino effect can be financially and emotionally difficult for all who are involved. For an extra layer of protection, it’s a good idea to also carry umbrella liability coverage, which kicks in to provide liability coverage above your homeowners limits.

Insuring the Real Value of Your Home

Experts estimate that one-fourth of remodeling projects add at least 25 percent to the value of a home, yet often most homeowners forget to increase their coverage to protect their investment. Most homeowners insurance policies require 100 percent of the home’s replacement cost, so it’s important to raise your home’s policy limit before your project begins.

The Basics

When undertaking a remodeling project, people often forget to review their insurance needs, too. Whether your addition budget is large or small, you are adding both the value of your home and your exposure to risk. To ensure that your project goes smoothly and that you have the coverage you need, here’s what you need to know.

Working with General Contractors

The best way to minimize your renovation risk is to hire a reputable general contractor for the job. As part of the bidding process, ask the general contractor to provide a Certificate of Insurance and/or copies of the policies. Specifically, check for coverage for the following:

  • Workers’ compensation: Verify that he or she has workers’ compensation coverage in the event that an employee or subcontractor gets hurt on the job.
  • General liability: Ask if the contractor has liability insurance, which covers losses due to negligence and errors or omission, which results in property damage. Also, ask that you are added as an “additional insured.”
  • Builders risk: This policy is designed to cover damage to your home and materials, including those not installed yet. We can help you verify whether you should require this from your contractor, based on your renovation project.
    If they don’t carry the proper coverage, they are not the right contractor for the job!

Your Insurance Partner
Adding to your home is exciting, but poses financial risks. Contact Cleary Insurance, Inc. at 617-723-0700 to learn more about all of our home, auto and life personal risk management solutions.

Personal Cyber Coverage Explained

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Today’s society has grown increasingly digital in nature, with many individuals leveraging smart devices within their daily lives. Although this technology can offer various benefits, it can also make individuals more susceptible to cybercrime. Such incidents have steadily become more common and costly. In fact, the FBI reported receiving more than 800,000 complaints regarding cybercrimes in the past year, totaling $4.2 billion in overall expenses.

These findings emphasize how critical it is for individuals to safeguard themselves and their families from cyber events. That’s where personal cyber insurance can help. Typically offered as an endorsement to a homeowners policy, this form of coverage can provide financial protection for losses resulting from a range of cyber incidents—including fraud, identity theft and data breaches. Keep reading to learn more about the growing need for this coverage and the key types of personal cyber insurance available.

The Growing Need for Personal Cyber Coverage

Technology has continued to advance in the past decade, playing a larger role in how individuals live, work, and entertain. A variety of online platforms have given individuals the ability to stream content, communicate with others, shop for goods and make electronic payments at the click of a button. Additionally, smart devices have allowed individuals to upgrade a number of household appliances (e.g., thermostats, fridges, doorbells and security systems). Altogether, this technology has contributed to the growing adoption of the Internet of Things (IoT), which refers to any devices that connect or send information to the internet. Looking ahead, insurance experts anticipate that the average household will possess as many as 50 IoT-capable gadgets by 2023.
While these devices certainly offer several advantages, increased technology utilization also comes with greater cyber vulnerabilities. As technology advances, so do the tactics of cybercriminals—resulting in more frequent and severe cyber events. Here are some of the most common cyber incident scenarios that individuals and their families may encounter:

  • Bank fraud—This form of fraud entails a cybercriminal gaining unauthorized access to an individual’s electronic bank credentials, allowing them to transfer and steal funds from the individual’s account. According to a recent report from NortonLifeLock, cybercriminals steal over $170 billion each year via bank fraud.
  • Identity theft—Such theft refers to a cybercriminal accessing an individual’s personal information (e.g., Social Security number or credit card number) and using it to commit fraud or other crimes under the individual’s name. The Federal Trade Commission confirmed that nearly 1.4 million complaints related to identity theft were filed last year, up 113% from the previous year.
  • Data loss—In the event that an individual’s device gets infected with a virus or other malicious software (also called malware), they face the risk of losing any valuable data stored on that device. Viruses and malware can come from numerous avenues, including harmful websites, dangerous email attachments or infected USB flash drives—thus making data loss a major threat.
  • Extortion—Ransomware incidents have contributed to a substantial rise in cyber extortion over the last few years. These incidents stem from a cybercriminal using malware to compromise an individual’s device (and any data stored on it) and demanding a ransom payment in exchange for restoration. In some cases, the cybercriminal may even threaten to publicly share the individual’s data if they don’t receive payment. According to cybersecurity experts, ransomware incidents have increased 500% since 2018, with the average ransom payment totaling over $300,000.
  • Cyberbullying—While social media platforms allow individuals to connect with others, these platforms can also, unfortunately, be used for negative purposes, such as cyberbullying. This type of bullying includes refers to harassment, threats or other intimidating language that occurs via electronic means. Although anyone can be a victim of cyberbullying, kids and teenagers are particularly vulnerable. The latest data from Pew Research revealed that 59% of teens have experienced cyberbullying.
    Considering these risks, it’s clear that individuals can’t afford to ignore cybercrime. In addition to implementing effective cybersecurity practices (e.g., using trusted devices, browsing secure websites, conducting software updates, backing up data, creating unique passwords and knowing how to identify potential scams), having adequate insurance in place is crucial. By investing in personal cyber coverage, individuals can properly protect themselves and their families amid cyber-related losses.

Types of Personal Cyber Coverage

Personal cyber insurance varies between insurers. However, there are a number of key coverage offerings available:

  • Online fraud coverage—This coverage can offer reimbursement for financial losses that may result from the various types of online fraud, such as phishing scams, identity theft or unauthorized banking.
  • Online shopping coverage—Such coverage can help pay for the cost of any goods that were purchased online but arrived damaged upon delivery or didn’t get delivered whatsoever.
  • Identity recovery coverage—This coverage can provide reimbursement for the expenses associated with recovering from an identity theft incident (e.g., rectifying records with banks or other authorities, hiring a consultant to assist with credit restoration and taking unpaid time off from work to recover from the incident).
  • Data restoration coverage—Such coverage can help compensate the cost of having an IT specialist recover a device and restore any data stored on it if the device gets infected with a virus or malware.
  • Data breach coverage—This coverage can offer reimbursement for the necessary notification and recovery services in the event that private, nonbusiness data entrusted to the policyholder becomes lost, stolen or published.
  • Cyber extortion coverage—Such coverage can help pay for the expenses associated with responding to a ransomware event (e.g., consulting an IT specialist to mitigate the extortion attempt and restoring compromised devices or data).
  • Cyberbullying coverage—This coverage can provide reimbursement for the costs that come with recovering from a cyberbullying incident resulting in unlawful harassment or defamation of character. These costs may include psychological counseling services, legal advice, temporary relocation expenses and social media monitoring software. This coverage can also offer protection if an individual or their child faces engages in cyberbullying and faces subsequent legal action from the victim.

Because personal cyber insurance is still a relatively new type of coverage, it is usually only available as an add-on to an existing homeowners policy. Further, certain insurers only provide this coverage as an endorsement for high-value homeowners policies. Yet, some insurers may offer standalone personal cyber coverage. Moving forward, insurance experts expect the personal cyber coverage market to continue growing, allowing for more widely available policy options. In any case, individuals should consult trusted insurance professionals to discuss their specific coverage capabilities.

For further risk management resources and insurance solutions, contact us today.