[cabfpub] Ballot 121 (insurance)

kirk_hall at trendmicro.com kirk_hall at trendmicro.com
Fri May 30 23:19:58 UTC 2014

Ben -- as I indicated to the EV Working Group in an email recently, I have definitely changed my mind about the EVGL insurance requirement based on my own experience in starting AffirmTrust in 2010.  (As a reminder to all, AffirmTrust was acquired by Trend Micro in 2011, and Trend is big enough and has a strong enough balance sheet and treasury that under the EVGL we are entirely exempt from the insurance requirements -- so we have no personal stake in this.)  

While starting my own company, the insurance brokers kept asking me why I wanted the insurance coverages -- they clearly didn't think I needed them -- and they warned me that the E&O coverage in particular probably wasn't going to provide me with any meaningful protection for anything (given that it generally doesn't cover contractual liability for a bad cert, return of fees, etc.)  So it felt like a very big waste of money.

Plus we now know from eight years of experience (plus the anecdotal evidence of Trend Micro's legal counsel from his decade at VeriSign) that there simply aren't claims from customers or relying parties for mis-issued certs and that the need for insurance (even if it did cover the mis-issuance of EV certs) is minimal at best.  The one case of catastrophic failure and breach, DigiNotar, apparently resulted in a court ruling that the insurer would be allowed to deny all coverage.

When we collectively were brainstorming in 2005-6 to create the first EV Guidelines, we were trying to come up with lots and lots of requirements to try to set EV certs apart from other certs.  As I recall, we considered even more complex verification steps for EV to make it similar to the closing of a major corporate transaction (e.g., getting Board of Directors authorizations, Secretary's Certificates, etc.) -- fortunately, common sense prevailed and we slimmed down the requirements so they are very thorough, but achievable.

Finally, the Forum has learned through eight years of experience that these insurance requirements are even harder and more expensive for non-US/Canadian CAs to satisfy, and that their brokers also tell them the coverages won't provide them with any meaningful protection.  We don't want the EV Guidelines to be weighted in favor of US/Canadian CAs.

The Forum hasn't hesitated from changing other EVGL requirements when we think justified -- such as recently allowing the use of the automatic email verification method to upgrade domains to the EV level (using the same verification methods as for DV and OV certs).  For the first seven years of the EVGL, we were all required to do manual vetting of domains with a WhoIs lookup and deal with any mis-match of the registration.

So for all these reasons, I think Gerv is right and it's time to drop the insurance requirements.   Let CAs follow any insurance requirements that their applicable local jurisdiction(s) may impose, but otherwise don't create an additional insurance requirement through the EV Guidelines.

Gerv, thanks for sharing your thoughtful and well informed opinion.  It really helps.


-----Original Message-----
From: public-bounces at cabforum.org [mailto:public-bounces at cabforum.org] On Behalf Of Ben Wilson
Sent: Friday, May 30, 2014 3:15 PM
To: 'Gervase Markham'; 'public >> CABFPub'
Subject: Re: [cabfpub] Ballot 121 (insurance)

Gerv and all,

If people want to save money, they can stick to issuing DV or OV certificates.  EV certificates need to remain different, and this proposed move is contrary to the first goal we all agreed upon when we began working on the guidelines for issuing Extended Validation Certificates, which my notes indicates was to "increase online trust."  

If the ballot is re-introduced and passes, then CAs will not be required to have insurance for any negligence in issuing or maintaining EV Certificates.
It increases the likelihood that another Diginotar won't be held accountable, and I believe the insurance is currently available at affordable cost, approximately $10,000 per $1 million coverage.  I have attached a sample cyber-insurance policy, which is available in similar form from any of top insurers internationally-- Zurich, ING, AIG, AXA, Allianz, etc.

The reintroduction of Ballot 121 also reopens negotiations of 8 years ago, which took place during 2006.  For example, attached is Kirk Hall's memo to the group from June 2006 in which he recommends "indemnity insurance coverage (e.g. "errors and omissions," "cyber coverage," "network computer liability," "professional liability," or other similar coverage) for Extended Validation Certificates [in the amount of $10 million]."  

Opponents of insurance requirements cannot simply erase these historical choices without proposing viable alternatives.  (It's always easier to complain and to poke holes at things than to work on real solutions.)  And finally, if the EV Guidelines do not contain some form of financial responsibility, then we might as well delete the Section 7 warranties, and the other EV provisions to which they refer, because they will just become
empty promises.    


-----Original Message-----
From: public-bounces at cabforum.org [mailto:public-bounces at cabforum.org] On Behalf Of Gervase Markham
Sent: Friday, May 30, 2014 12:41 PM
To: public >> CABFPub
Subject: [cabfpub] Ballot 121 (insurance)

I talked to our lawyer this morning. Mozilla is now willing to support the proposal in Ballot 121 (removal of the insurance requirement from the EV Guidelines).

We feel that this requirement provides no significant protection in practice for either users, for whom CAs can limit liability to $2000 anyway, or for browsers, for whom clause 18.2 which indemnifies them is much more relevant.

We encourage other CAs and browsers to support this ballot also, and let the CAs put the $N,000 saved towards making their products better and/or cheaper for users.

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