Countering Crime Insurers' 'Direct Loss' Defenses against Coverage for Cyber Scams

Among the various arguments insurance companies have deployed to attempt to deny “Computer Fraud” coverage under crime policies, three have been focal points in multiple court contests. All three are variants on the theme that the crime in question was not “brute force” hacking per se – direct invasion of a computer – but scams that in one way or another induced action from individuals acting on behalf of the targeted organization. Participants in this session will learn the nuances of these defenses against coverage, the grounds on which state and federal courts have rejected them, and the terms in which to credibly resist coverage denials under crime policies when their organizations are the victims of cyber scams.