Abstract
The adoption of digital technology creates new harms. Given that risk prevention solutions are imperfect, individuals may wish to transfer digital risk to an insurer. It is unclear whether existing insurance policies cover these harms, or whether specialized consumer cyber insurance products are available. We address this research gap by conducting a content analysis of 50 insurance policies, 32 in the US and 18 in the UK. Our analysis of 26 home insurance policies reveals that insurers typically exclude digital perils (losses caused by computer viruses, hacking or cyber attacks), but include coverage for digital assets (devices and downloaded data) impacted by conventional perils. A minority of home insurance policies affirmatively cover digital perils like identity theft and social media defamation. Our analysis of 24 consumer cyber insurance products identifies 6 core perils that are generally covered: cyber attack, data breach, ransomware, online fraud, cyber bullying, and identity theft. Finally, pricing information from 21 policies reveals specialist cyber policies typically cost between $20 and $150. One insurer’s actuarial calculations suggest the expected losses range from $2 (online fraud) to $9 (computer attack). These findings can help users form strategies to manage digital risk.
