Cyber Insurance Considerations in M&A Deals
Written by Judy Selby, Managing Director at BDO Consulting, a Partner of M&A Leadership Council
Merger and acquisition (M&A) activity continued to make headlines in 2016. Corporate giants including AT&T, Bayer AG, CenturyLink and General Electric announced massive acquisitions, while the Verizon/Yahoo! deal highlighted the importance of cybersecurity due diligence in the M&A context. Simultaneously, uptake of insurance for cyber-related risks – so-called cyber insurance – continued to increase in 2016. Appreciation of the role of cyber insurance in connection with M&A activity, therefore, is taking on increased importance.
While people may think of cyber insurance when confronted with a data breach, the role of cyber coverage may not be top of mind in the context of a merger or acquisition. It should be, though, because cyber policies typically contain provisions that directly affect coverage in light of such transactions. Enterprises should take a close look at their cyber policy provisions early on in the deal-making process so that coverage for the affected enterprises can be secured.
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BDO will be discussing this topic and more at our Art of M&A Due Diligence workshop next month in San Diego. For information on this workshop and all of our upcoming events, visit the M&A Leadership Council Training Calendar.
