Insurer Not Off The Hook In $3.5 Million Computer-Hack Case
October 12, 2014
After hackers managed to route $3.5 million from a customer’s Philadelphia bank account to recipients in Russia and Belarus, the bank covered the loss for the customer. Then it filed a claim with professional liability insurer St. Paul Mercury Insurance Company. The carrier balked, arguing that the bank’s decision to compensate the customer was voluntary, and taken without the carrier’s consent. But a federal court denied the insurance company’s motion to dismiss. Reed Smith attorneys Courtney C. T. Horrigan and Caitlin R. Garber lay out the case and say there are a number of important lessons that companies can derive from it.
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