"These two new model clauses provide broad policy exclusions which may be utilized as a starting or reference point for underwriters offering cover for traditional business classes that may include an element of cyber risk," said Chris Jones, IUA director of legal and market services, in a statement.
Both clauses were developed in response to concerns expressed by the UK Prudential Regulation Authority (PRA) about potentially unintended or unclear provision of coverage for cyber risks in various classes of insurance business, explained the IUA.
The two new cyber clauses are available to download, along with all IUA model clauses, from the association's clauses website (http://www.iuaclauses.co.uk) www.iuaclauses.co.uk.
The first new model clause, called "Cyber Loss Absolute Exclusion Clause" (reference: IUA 09-081), provides market participants with an option to exclude in the broadest possible manner any loss arising from the use of a computer system, network or data - each of which is clearly defined.
The second model clause, called "Cyber Loss Limited Exclusion Clause" (reference: IUA 09-082), enables only the exclusion of losses directly caused by cyber events, rather than "directly or indirectly."
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