In separate announcements late last month, Munich Re’s HSB and Coalition unveiled two novel cyber insurance offerings. HSB aims to cover cyber insurance for autos, while Coalition announced an endorsement that clarifies the presence of coverage when artificial intelligence technology causes a failure of computer systems’ security.


HSB Introduces Cyber Insurance for Autos

Personal cars and trucks will likely be the next big target for hackers and cyber thieves, according to specialty insurer HSB, which has launched a new cyber insurance product to help consumers respond to the threat.

Called “Cyber for Auto,” HSB’s coverage aims to help safeguard private information stored in personal vehicles and connected to cloud-based and wireless communication networks.

“Automakers continue to integrate new technologies into today’s vehicles,” said James Hajjar, chief product and risk officer for the Treaty Division of HSB, a Munich Re subsidiary. “With each added system or connection, there are new vulnerabilities that hackers and other cyber criminals can exploit. Cyber for Auto helps insurers and their customers stay ahead of these new cyber exposures.”

HSB notes that when drivers connect their smartphones with cars, pickups, and SUVs, they may expose their personal data and connected technology to hackers and other cyber criminals, leaving them vulnerable to cyber-attacks, online extortion, and identity theft.

HSB Cyber for Auto is designed to cover attacks on personal data that is connected and stored in a vehicle.

Core coverage can be triggered by cyber attacks, including malware and viruses, and ransomware demands to release information or threats to make confidential data public.

Identity recovery coverage and services are not limited to information stored in the vehicle but can apply anytime personally identifying information has been compromised. Additional benefits can include payment for towing, labor, and temporary transportation charges while affected auto systems are restored.

A recent HSB survey found that 72 percent of consumers have synced their phones with their personal vehicles and 60 percent store personal information in their vehicle computer systems.

The survey also found that 36 percent are very concerned their personal information will be compromised and 28 percent are extremely concerned. Concern jumps to 79 percent among those with plug-in electric vehicles.

(Editor’s note: HSB didn’t make the survey public, but a summary of the findings are available here).

HSB’s Cyber for Auto will be available through an endorsement to the policies of insurance companies that partner with HSB.

The Cyber for Auto insurance offering has not yet been approved by any state insurance departments, but approvals are pending, HSB said.


Coalition Adds Affirmative AI Endorsement to Cyber Policies

Coalition, which describes itself as an insurance provider designed to prevent digital risk before it strikes, announced in late March that it has added a new Affirmative Artificial Intelligence (AI) Endorsement to clarify what is covered by its U.S. Surplus and Canada Cyber Insurance policies.

The endorsement expands the definition of a security failure or data breach to include an AI security event, where AI technology caused a failure of computer systems’ security.

The Affirmative AI Endorsement language also expands the trigger for a funds transfer fraud (FTF) event to include fraudulent instruction transmitted through the use of deepfakes or any other artificial intelligence technology.

“As threat actors adapt their attack strategies by incorporating AI, Coalition’s Affirmative AI Endorsement introduces important clarity around how incidents are covered when AI is involved,” said Shawn Ram, Coalition’s Head of Insurance. “While FTF and data breach coverages have always been cornerstones of our policies, this new endorsement gives brokers confidence that they’re offering their clients the most comprehensive cyber coverage—and provides policyholders with peace of mind.”

Cybersecurity trends point to attackers using generative AI tools in the wild to launch more sophisticated cyber attacks and potentially extort larger amounts of money from victims. Coalition uses these insights to inform its underwriting and coverage approach to help better protect policyholders against digital risks.

“AI is revolutionizing and supercharging technology worldwide, and while it’s emboldening attackers to create more personalized attacks en masse, we continue to believe AI has huge potential to empower defenders and strengthen cyber and insurance protections,” said Tiago Henriques, Coalition’s Head of Research.

Coalition’s AI Endorsement can now be added to any U.S. Surplus and Canada Cyber Insurance policies. In 2023, Coalition introduced CoalitionAI, an initiative to deploy generative AI and large language models to help brokers and businesses address cyber risk through collaborative chat copilots. Since then, Coalition has also integrated AI to improve the fidelity of its underwriting, be more precise about risk segmentation, and enhance the quality of its customer service, the company said.

Sources: HSB, Coalition