The Administration & Regulatory Affairs (ARA) and Houston Information Technology Services (HITS) Departments recommend that City Council: (1) approve the proposed Cyber Insurance policies recommended by the City’s Insurance Broker of Record, McGriff, Seibels & Williams, Inc. (McGriff); and (2) accept the individual proposals from the insurance carriers listed below that are participating in the layered Cyber Insurance program recommended by McGriff.
A Request for Proposals (RFP) for Cyber Insurance was issued and advertised on July 15, 2022 and July 22, 2022 for coverage effective September 1, 2022. Additionally, McGriff solicited proposals from 61 domestic and international insurance carriers of which two proposals were received. No individual insurance company proposed more than a $5 Million limit. Therefore, McGriff structured a multi-layered program, consisting of a primary layer plus one excess layer. Terms of the proposed policy are:
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Term: September 1, 2022 to September 1, 2023
- Insurance Carriers: AIG Specialty Insurance Company and Hamilton (Lloyd’s of London)
- Total Premium Cost: $843,813
- Insured Limit: $10,000,000
Retention: $2,500,000
- Business Interruption Waiting Period: Security Failure 24 Hours and for System Failure 48 Hours
- Type of Coverage: Cyber Insurance for (a) first party coverages including loss of business income, extra expenses and data recovery resulting from a cyber security breach, (b) cyber extortion and ransomware in response to a cyber extortion threat and (c) first party coverage for data breach response, crisis management expenses, including forensics
Fiscal Note:
Funding for this item is included in the FY23 Adopted Budget. Therefore, no Fiscal Note is required as stated in the Financial Policies.
Departmental Approval Authority:
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Tina Paez, Director Lisa Kent, Director
Administration & Regulatory Houston Information Technology Services
Affairs Department Department