HowyGuardWhat happens if I answer my cyber insurance application wrong?
The form you sign says your answers are accurate and complete. Many applications also say that if anything in them isn't correct, the insurer can treat the insurance as if it never existed. In one public US case, an insurer and its customer agreed to void a policy over an MFA answer. Tell your broker, and fix the gap.
What are you agreeing to when you sign?
Near the signature line, most cyber insurance applications have a sentence about accuracy. It usually says the information is accurate and complete, and that you made reasonable attempts to check it by asking the right people in your business.
So you're promising two things: that the answers are right, and that you checked with the people who would know. A guess you didn't check fails the second part even if it turns out to be correct. Read the signing section on your own form. The checklist covers how to check each item.
What does the form say happens if an answer isn't true?
Many applications say it directly: if anything in your statements isn't correct, the insurer can treat the insurance as if it had never existed. That has a name, rescission. Some forms also have the person signing certify that they made reasonable inquiry and that the answers are true, correct and complete to the best of their knowledge.
Has this actually happened?
Yes, at least once in a way that's on the public record. In 2022, a US insurer went to court against its customer, saying the customer's application had stated that multi-factor authentication was in place across the company when it wasn't.
The case didn't go to a ruling. Both sides agreed to void the policy, and the court entered an order declaring it void.
That's a US case about a US policy, and we're not going to guess how anything similar would go in Canada. What it does show is how much weight one yes about MFA can carry. If your form asks about MFA on admin accounts and remote access as well as email, each of those is its own promise.
What if you've already sent a wrong answer?
Tell your broker as soon as you notice, and give them the true answer. Then fix the gap if you can, so the answer can be a real yes by the time you renew.
What to do next
- Read the exact words of each question. "All", "always" and "enforce" leave no room for one account that got missed.
- Check the setting, or ask whoever manages it. How to check the answer to a question covers how.
- If something isn't true yet, fix it now so your answers are true, or tell your broker how things are today.
Common questions
Will my claim be denied if I made a mistake?
We can't tell you that, and nobody outside your insurer can. Only the insurer decides how it handles a claim. Why cyber insurance claims get denied covers the documented cases.
Can I answer "partly" instead of yes or no?
Some forms let you, with options like "sometimes" or a box to describe what you do. Where a form only allows yes or no, ask your broker how to word an honest answer.
Who is responsible if my IT provider gave me the wrong answer?
The form is signed by the business, so the answers are the business's. Who should sign the application covers how to get help with the answers without handing over the signature.