A Cyber Working Group was established to review LMA5478 and LMA5479, following instances where cyber-related claims were brought under PI policies for alleged breaches of professional services. These cases raised concerns about the effectiveness of current clause wordings in reflecting underwriting intent. The group aims to ensure that cyber risks are either clearly covered or excluded, as intended by underwriters. 

The group have now published LMA5478B, an update to LMA5478A. This clause forms part of a suite of three Financial Institutions PI cyber clauses:

• LMA5477A: Cyber Risks Endorsement
• LMA5478B: Cyber Risks Endorsement – Limited Exclusion
• LMA5479A: Cyber and Data Exclusion

Please note that LMA5478A has been archived.

Class action lawsuits can lead to large-scale claims that involve numerous plaintiffs, potentially leading to high pay-outs for insurers. The committee is continually reviewing policy terms and coverage scenarios to address the unique challenges posed by class action lawsuits.

Litigation trends in financial institutions insurance are increasingly complex, global and fast-evolving. They reflect the shifting regulatory environment, technological risks and greater scrutiny from shareholders, regulators and customers.

The committee receives regular updates from legal representatives on key topics. Recent areas of interest include motor finance litigation, batch clauses and computer crime wordings, providing valuable insights into evolving legal and insurance challenges in these sectors.