The cannabis industry has many component parts, from growers to retailers (dispensaries), and everything in between. And each component part of this burgeoning industry has its own set of risks and exposures, for which it will need insurance protection.
Continue Reading Fast Times at Ridgemont…Oh Forget It. The Cannabis Industry Is New; and So Are the Insurance Issues, Sort of.

As the risks associated with cyber liability continue to evolve, so do the insurance products that are theoretically meant to protect against those risks. As the insurance industry attempts to keep pace, the applications that insurers are using to capture the data they believe is necessary to underwriting these risks are also evolving and vary to a large degree. Regardless of whether an application is long or short or seeks information in generalities or in detail, all prospective policyholders must take care in completing these applications, enlisting the help of a data security professional (whether within the organization or a consultant) and possibly of a good broker that specializes in this area. Indeed, a failure to provide accurate information could cause an insurer to resist providing coverage for a claim, or attempt to rescind the policy, on the purported grounds that there was a material misrepresentation in the policy application.

This article first provides an overview of the key categories of information that most cyber-liability insurance applications seek, followed by some of the key principles of which a policyholder should be aware in the event an insurer attempts to deny a claim or rescind a policy based on alleged misrepresentations or omissions in the policy application. 
Continue Reading Filling Out a Cyber Insurance Policy Application: Do Not Give Insurers a Material Misrepresentation Defense

Directors & Officers liability insurance—commonly known simply as D&O insurance—is meant to protect corporate directors and officers from, among other things, claims alleging breaches of duty and management failings that adversely affect the value of the company’s stock. And any event in which directors or officers are deemed to have had an oversight function could ultimately result in a claim that floats up to the director- or officer-level if the company’s stock suffers. 
Continue Reading D&O Coverage for Tech Risks – Don’t Let the “Invasion of Privacy” and “Professional Services” Exclusions Take You by Surprise

Companies engaged with digital assets, particularly those companies without a track record, are finding it to be a struggle to procure broad directors & officers (“D&O”) liability coverage.  Specifically, insurance underwriters are spooked by the regulatory uncertainty surrounding digital assets, particularly Initial Coin Offerings (“ICOs”), which have emerged as an alternative to traditional equity offerings, e.g., the sale of stock in a venture.  The reality, however, is that many companies engaged with “coins” or “tokens” or other digital assets also raise capital through traditional securities offerings, and they need protection for those activities.  But many underwriters are not willing to sell coverage for those traditional activities, merely because the company also is engaged in the digital asset space. 
Continue Reading Companies Engaged with Digital Assets Should Push For D&O Coverage That Protects Traditional Securities Activities

For approximately the past decade, cryptocurrencies were used by those who wanted to transact business anonymously and without oversight or restrictions imposed by any governmental authority.  More recently, the concept of cryptocurrencies has been used to raise capital outside of traditional financial structures.  Indeed, the rise of raising money through the issuance of “virtual tokens” using “Initial Coin Offerings” (“ICOs”) has caused a sharp rise in the prevalence and market value of cryptocurrencies.

Those involved with cryptocurrencies believe that their virtues include stronger security against theft, easier transactions, and insulation from government-induced currency fluctuations, among other things.  But the inescapable reality is that hackers, technical errors, and fraud happen.  In addition, regulators have been taking notice and have been attempting to flex their authority, although the manner in which any given regulation applies to cryptocurrencies is far from certain.  One thing that is certain, is that the cryptocurrency “industry” poses unique and evolving risk.  Given this, the insurance industry is also engaged in attempting address the needs of this emerging market, although underwriters can be expected to rigorously assess the risks posed, and insurance procurement can be a challenge for some.
Continue Reading The New Money: Cryptocurrencies and the Role of Insurance

Welcome to The Perkins Coie Tech Risk Report, a source for updates on, and analysis and interpretation of, insurance issues relevant to emerging technologies. We will address coverage issues related to cyber coverage, privacy, digital assets like cryptocurrency, Blockchain and other emerging technologies. The blog is written for start-ups and other companies dealing with emerging