Jenner & Block

Insurance Law Update: Avoiding A Potential Coverage Gap For Data Fraud Resulting From IT Infrastructure Weaknesses

As part of an ongoing, monthly series, the Los Angeles and San Francisco Daily Journal republished the August 2016 edition of the firm’s Insurance Law Update co-authored by Partner Jan Larson and Associate Ashley Van Zelst.  They discuss why policyholders whose businesses use technology platforms and products that may be susceptible to programmatic weaknesses or errors should carefully review their insurance coverage to understand whether certain forms of any resulting data fraud will be covered.  Fidelity and crime insurance policies often limit coverage to unauthorized access or access stemming from some form of misrepresentation or fraud.  As a result, policyholders may find themselves without coverage for losses caused by authorized access that takes advantage of challenges in the technology platform or product to perpetrate data fraud.  To avoid a potential coverage gap, a policyholder may need to seek out separate coverage particular to such a loss.

To read the full alert, please click here