Social engineering attacks, particularly fraudulent transfers, are becoming one of the most utilized cyber scams.  As a result, there has been a flurry of litigation, and a patchwork of decisions, concerning coverage disputes over social engineering losses.  Most recently, the United States District Court for the Eastern District of Virginia found in Midlothian Enterprises, Inc. v. Owners Insurance Company, that a so-called “voluntary parting” exclusion provision in a crime policy should exclude coverage for a fraudulent transfer social engineering scheme.  The decision illustrates why policyholders must vigilantly analyze their insurance policies to ensure that their coverages keep pace with what has proven to be a rapidly evolving risk landscape.

Continue Reading Voluntary Parting Exclusion Bars Coverage for Social Engineering Scheme

The members of Hunton’s Insurance Recovery group present regularly on today’s hot topic insurance coverage issues. Upcoming insurance presentations for March 2020 include:

As crypto-asset losses continue to rise, the industry is taking steps to protect clients and investors through insurance. Crypto-exchange and custody provider, Gemini Trust Company, LLC (“Gemini”), recently launched its own captive insurance provider, Nakamoto, Ltd. Captive insurance is an alternative to self-insurance whereby a company creates a licensed insurance company to provide coverage for itself. According to a statement from Gemini, Nakamoto is “the world’s first captive to insure crypto custody” and allows Gemini “to increase its insurance capacity beyond the coverage currently available in the commercial insurance market” for cryptocurrency wallets not connected to the internet, commonly referred to as “cold storage.” According to Gemini, this move makes Nakamoto the world’s most insured crypto-asset cold storage solution, which signals an expectation of increased demand in the crypto market.

Continue Reading Captive Insurance Offers Protection to Growing Crypto-Currency Industry

Illinois National Insurance Company, an AIG Commercial Insurance company, (“AIG”) told a Pennsylvania federal court in a brief opposing summary judgment that it has no duty to defend Hub Parking Technology USA Inc. (“Hub”), a Pittsburgh-area parking technology company, in a third-party complaint alleging a privacy breach that exposed customers’ credit card numbers at Cleveland Hopkins International Airport.

Continue Reading Insurer Argues No Coverage for Privacy Breach That Exposed Credit Card Numbers

A New York federal court denied AIG Specialty Insurance Company’s (“AIG”) motion to dismiss breach of contract and bad faith claims in a lawsuit filed by SS&C Technology Holdings, Inc. (“SS&C”). SS&C alleges that AIG breached its contract by failing to cover losses stemming from a cyber incident in which hackers duped the company out of millions of dollars.

Continue Reading Insurer Must Face Email Spoofing Lawsuit

Recent headlines underscore the security challenges faced by public-facing businesses. From physical threats to cyber attacks targeting a wide range of critical infrastructure, companies in diverse sectors, such as the financial, retail, entertainment, energy, transportation, real estate, communications and other areas, face a challenging landscape of risks and potential liabilities. Join us on October 28, 2019, at 12:00 p.m. EST, for a webinar to discuss these issues, including why companies should consider SAFETY Act protection and how to obtain it.

Continue Reading Webinar on the SAFETY Act, Security and Insurance

In a recent Global Data Review article, Hunton Andrews Kurth insurance practice head Walter Andrews commented on the FBI’s guidelines on ransomware payments and the insurance industry’s aggressive marketing of ransomware policies, noting that policyholders now have a resource that can help cover the cost of such an attack. The full Global Data Review article

Phishing has been around for decades.  But now, the long-lost ancestor claiming to be a foreign prince is stealing more than your grandmother’s savings.  Phishers are targeting corporations—small and big, private and public—stealing sensitive data and money.  When Policyholders take the bait, they had better have a tailored insurance policy to keep their insurers on the hook as well.

Continue Reading Go Phish: Texas Lawsuit Highlights Need for Tailored Cyber Policies

Insurance partner Michael Levine is teaming up with Hunton’s Michael Perry and Adam Solomon and Jones Day’s Lisa Ropple to discuss cybersecurity litigation and insurance coverage presentation for the Massachusetts Bar Association. The presentation, sponsored by the MBA’s Complex Commercial Litigation Section, will take place on Wednesday, March 20th at 4:30 pm at the MBA’s office in Boston. Topics will include:

  • General litigation claims arising from cybersecurity incidents and defenses available to companies facing these claims.
  • Safeguards to prevent cyberattacks from outside sources.
  • Insurance coverage issues arising out of cybersecurity incidents.


Continue Reading Hunton Insurance Partner Michael Levine to Present on Cybersecurity Litigation to the Massachusetts Bar Association

Notwithstanding the absence of a congressional war declaration since Japan bombed Pearl Harbor, Zurich American Insurance Company has invoked a “war exclusion” in an attempt to avoid covering Illinois snack food and beverage company Mondelez International Inc.’s expenses stemming from its exposure to the NotPetya virus in 2017. The litigation, Mondelez Intl. Inc. v. Zurich Am. Ins. Co., No. 2018-L-11008, 2018 WL 4941760 (Ill. Cir. Ct., Cook Cty., complaint filed Oct. 10, 2018), remains pending in an Illinois state court.
Continue Reading Zurich Invokes War Exclusion in Battle Over Coverage for NotPetya Attack