A Texas manufacturing firm is suing its cyber insurance provider for refusing to cover a $480,000 loss, following an email scam that impersonated the firm’s chief executive.
At issue is a cyber insurance policy issued to Houston-based Ameriforge Group Inc. (doing business as “AFGlobal Corp.”) by Federal Insurance Co., a division of insurance giant, Chubb Group. AFGlobal maintains that the policy it held provided coverage for both computer fraud and funds transfer fraud, but that the insurer nevertheless denied a claim filed in May 2014 after scammers impersonating AFGlobal’s CEO convinced the company’s accountant to wire $480,000 to a bank in China. As cyber security insurance becomes more prevalent, businesses need to look at a qualified IT firm to help determine the nature of these policies and what is covered.
