Software Developer, $8M Cyber for a Global Tech Contract

A Sydney-based software development firm came to us after winning work with a large global technology company. They were a small team with annual revenue around $650,000 and a handful of contractors, building software for clients in resources and agriculture.

The contract from their new principal set out specific insurance requirements: high limits across professional liability, general liability and cyber, with the principal named as an additional insured and indemnity to principals included. The cyber requirement converted to around $8 million in cover.

For a business of this size, an $8 million standalone cyber limit sits above standard market appetite for a business this size. That was the challenge.

We worked through the contract clause by clause so the cover we arranged would actually satisfy it, then took the risk to our cyber panel and specialist markets.

• Several markets stepped back on appetite grounds. The requested limit was larger than many insurers will write for a business this size.
• We confirmed the AUD conversion with the client so every limit lined up with the contract's US-dollar thresholds.
• We built the cover in layers, pairing a primary cyber policy with an excess layer to reach the full limit the contract required.

Getting to $8 million for a small software firm meant presenting the risk carefully and going to the markets with the appetite for it, not just running a portal.

The main hurdle was the gap between the contract's limit requirements and standard market appetite. A high cyber limit on a modest revenue base is exactly the kind of risk that falls outside a lot of insurers' boxes.

We also had to make sure the structure met the finer contract terms - the additional insured wording and indemnity to principals - so the client could demonstrate compliance to their principal without any gaps.

Layering the cover added moving parts, since the primary and excess markets each had to be comfortable with the risk and with each other's terms.

We placed the cyber cover through Coalition with an excess layer sitting above it to reach the full limit the contract called for.

The structure met the contract's requirements and let the client get on with the work. For a small software business taking on a much larger principal, the cover was what unlocked the opportunity.

This case shows what specialist market access is for. Where a high limit sits outside standard appetite, layering cover across the right markets gets a small business to where its contracts need it to be.