Lloyd's Market Association Bulletin
LMA21-035-PD | 24 September 2021
Provision of coverage clarity in respect of cyber exposures - Directors and Officers clarification
In Market Bulletins Y5258 and Y5277 Lloyd's set out their requirements for ensuring that customers have clarity on coverage for cyber exposure.
The purposes of this communication is to provide updated guidance in respect of Directors' and Officers' policies.
With regards to Directors’ and Officers’ policies across both insurance and reinsurance Lloyd’s acknowledges these covers have a very specific ‘wrongful act’ trigger. On the basis that these policies will pay for damage as a result of the wrongful act howsoever caused and irrespective of whether a cyber event is linked to the wrongful act, we are satisfied that managing agents can write this business with no need for the express affirmation of cyber cover in the policy wording.
If, however, the managing agent intends to exclude or limit cyber exposures under these Directors' and Officers' policies they must apply a suitable exclusion wording.
For attestation returns, policies written in line with this approach can be recorded as complying with Lloyd’s guidance.