As businesses continue to increase their reliance on technology, they are bound to face the inevitable risks associated with online transactions and other cyber exposures. This, in turn, emphasizes the importance of having the proper insurance policies and compliance methods in place to prevent or, at least, mitigate losses that ensue from these risks. In this context, many insurance policies require that there be a “direct” loss for there to be coverage, which has spawned numerous lawsuits about what the word “direct” means. The latest court to weigh in has sided with the insured and interpreted that term broadly to essentially mean proximate causation.
Continue Reading Court Does Not Beat Around The Bush and Is Rather Direct In Rejecting Insurer’s Causation Argument In Computer Fraud Claim
Crime Insurance Policy
A Win for Policyholders Who Are Victims of Fraudulent Bank Transfer Schemes
By Scott P. DeVries & Yosef Itkin on
Recently, the Ninth Circuit dealt with a case involving a scenario that is becoming all too common. In Ernst & Haas Mgmt. Co., Inc. v. Hiscox, Inc., 23 F.4th 1195 (9th Cir. 2022), a property management company’s accounts payable clerk received several e-mails from her supervisor instructing her to pay some invoices. Unbeknownst to the clerk, these e-mails did not originate with her supervisor, but were actually part of a fraudulent scheme to elicit fraudulent bank transfers. The clerk paid off hundreds of thousands of dollars in “invoices” before becoming suspicious but, by then, it was too late and the damage was done.
Continue Reading A Win for Policyholders Who Are Victims of Fraudulent Bank Transfer Schemes
Continuous 4-Day Cyberattack on the New Zealand Exchange Highlights Importance of Insurance Coverage for Cyberattacks and of Having a Sound Strategy to Maximize Recovery
By Lorelie S. Masters & Jorge R. Aviles on
Trading on New Zealand’s stock exchange was disrupted last week, following four straight days of repeated cyberattacks that resulted in outages affecting debt, equities, and derivatives markets. The DDoS attack, which is said to have originated offshore, is allegedly part of a global extortion scheme that has also targeted companies like PayPal and Venmo. With this type of cyberattack becoming only more common and sophisticated, it is vital for policyholders to focus on the host of available insurance coverage options to protect against and maximize their insurance recovery following losses from a cyberattack.
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Continue Reading Continuous 4-Day Cyberattack on the New Zealand Exchange Highlights Importance of Insurance Coverage for Cyberattacks and of Having a Sound Strategy to Maximize Recovery
Insurer on the Hook for Loss Resulting From Phishing Scheme
On December 9th, the Eleventh Circuit held that a loss of over $1.7 million to scammers was covered under a commercial crime insurance policy’s fraudulent instruction provision.
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Continue Reading Insurer on the Hook for Loss Resulting From Phishing Scheme