UK Property Cyber Clauses

Following publication of Lloyd's Market Bulletin Y5258 sent on 04 July 2019 and the follow-up email from Jon Hancock sent on 01 October 2019, the LMA has been working on behalf of its members to draft model clauses which assist the market in providing clarity of cyber coverage under first-party property damage policies.

Subsequent to LMA Bulletin LMA19-031-PD (13 November 2019), publishing Property and Marine Cyber Clauses, the LMA has been working with various Business Panels to produce model clauses for use in particular lines of business.

In conjunction with the LMA’s Wordings & Contracts Forum, the UK Commercial Property and Household Business Panel has now published the following clauses:

LMA5404 – Cyber and Data Exclusion (for use on Consumer and Commercial Property Risks)
LMA5405 – Limited Cyber and Data Exclusion (for use on Consumer and Commercial Property Risks)

These, along with other model clauses, are available on the Lloyd’s Wordings Repository.

All model clauses published by the LMA are purely illustrative and are distributed for the guidance of its members, who are free to agree to different conditions or amend as they see fit. The LMA does not publish written guidelines with regard to application or intent of any specific contractual terms (unless use of such contractual terms would constitute a breach or potential breach of any law or regulation) and the LMA therefore cannot release any clause drafting history. The LMA (including all panels and working groups, which may include Joint Committees in conjunction with the International Underwriting Association (IUA)) in drafting such clauses operates under strict terms of reference to ensure, amongst other things, compliance with Competition Law and it is for underwriters to decide whether or not any contractual language is acceptable on any given risk.

Alison Colver
Head of Contract Wordings