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The Importance of Business Interruption Coverage Post-CrowdStrike Outage

Aug 8, 2024

The recent CrowdStrike IT outage sent ripples worldwide, underlining the critical nature of cybersecurity and the far-reaching consequences of technological disruptions. On July 18, 2024, a faulty update to CrowdStrike’s Falcon system resulted in widespread IT issues (including the infamous “blue screen of death” for many Windows users), affecting approximately 8.5 million devices globally. The outage caused major headaches across healthcare, aviation, retail, and beyond. Businesses reliant on CrowdStrike’s cybersecurity services scrambled to manage the chaos, faced with operational downtime, revenue losses, and additional remediation costs.

As CrowdStrike grapples with the aftermath, a wave of insurance claims is on the horizon, with the potential total expected to exceed $1 billion. Business interruption and cyber insurance coverage are in sharp focus, revealing their vulnerabilities. Not all business interruption policies cover losses from non-malicious incidents like software faults, a gap in coverage that has left many businesses at risk.

Cyber insurance policies have also been under the microscope. While these policies typically cover losses from cyberattacks and data breaches, coverage for non-malicious events like the CrowdStrike failure can vary significantly. This is a critical moment to advise your clients to conduct a comprehensive review of their existing cyber insurance policies to fully understand their coverage limits and exclusions. As industry experts suggest, prompt notification to insurers and detailed documentation are crucial steps in maximizing insurance recoveries. 

Keep Business Running with Jencap

Start your outreach now if you have clients without business interruption or cyber insurance coverage. As illustrated by the CrowdStrike outage, these breaches can affect almost any business. Look across industry sectors and connect with your network to ensure they’re prepared for and protected against these modern threats.

At Jencap, our Professional Lines team will navigate the unique and ever-changing intricacies of cyber insurance, ensuring that your clients’ policies are tailored to address both malicious and non-malicious events. Contact us today to learn more!
The Jencap Professional Lines Insurance Team

The Jencap Professional Lines Insurance Team

Whether it’s professional, management, or cyber liability, Jencap’s experienced brokers stay on top of industry trends and one step ahead of the competition, so they can offer the best guidance to you and your clients. Armed with decades of experience, Jencap’s dedicated professional lines team works tirelessly to navigate difficult risk placements, strict security control requirements, ever-changing market capacity, and unpredictable rate fluctuations.

Business interruption insurance | business interruption coverage

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Put Jencap to Work For You

Over the past few years, companies have faced a myriad of business risks — cost-cutting layoffs, supply-chain disruptions, sexual misconduct allegations, social inflation, cyber threats, and more. In our increasingly litigious society, it’s never been more important for businesses to ensure they’re protected. It’s also never been more challenging to secure reasonably-priced, comprehensive professional liability coverage. By partnering with a strong wholesale broker who focuses exclusively on professional lines, you and your clients will have the advantage, even in a hard mark.
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