When an insurance company fails to act in accordance with deadlines established by the Texas Prompt Payment of Claims Act, it faces stiff consequences—specifically, 18% penalty interest on amounts owed to the insured.

Recently, Lloyd’s of London and the University of Cambridge co-authored a report forecasting that a major cyberattack on the East Coast of the U.S. could result in $70 billion in claims, stressing potentially gaping deficiencies in both traditional and cyber policies to respond to such an event.

This week Tarron Gartner-Ilai's and Whitney Warren's in-depth article on what constitutes a material breach was published in The Journal of Texas Insurance Law, a State Bar of Texas publication. 

As cyber attacks make almost daily news, the attorneys at Amy Stewart Law are spending an increasing amount of their time making sure the firm’s clients have adequate coverage from this constantly evolving threat. The firm’s work with cyber insurance was featured in a column by the Dallas Morning News’ Cheryl Hall.

Please join Amy Elizabeth Stewart along with the rest of the panel for this two-hour webcast on Friday, August 7^th. The course will contain an in-depth discussion of the fundamentals of M&A insurance as well as updates surrounding Insurance needs of D&Os, businesses, and selling stockholders that arise in connection with public and private mergers and acquisitions.

Cyber Insurance  ::  The Future is Now Webcast

From nearly 20 million security incidents detected in 2011 to more than 40 million in 2014, cyber breaches are dominating headlines.  As corporate America attempts to stay ahead of its cyber exposures, the insurance industry is scrambling to create solutions to meet the risk-transfer demand.

After cyber breaches have dominated the headlines for more than a year (e.g., Target, Sony), experts now say there are two types of businesses in today’s world –  those who know they have been hacked, and those who have not yet discovered the breach.

Imagine a situation in which the employee of your company’s vendor is injured while performing work for your company under a service agreement. The employee, likely unable to sue his or her own employer due to the exclusive remedy provisions of an applicable state’s workers compensation act, sues your company.

In late May, the Fifth Circuit decided Robert and Kerry Spong’s case against their insurer, Fidelity National Property and Casualty Insurance Co., holding that state law rights relating to an insurer’s claims handling are preempted by federal law, but those concerning the sale of the policy itself are not.

Sony and Zurich recently reached a settlement in an insurance coverage dispute over the April 2011 hacking of Sony’s PlayStation network, resulting in the release of personal information of over 77 million user accounts. At the time, it was the largest data security breach in history, costing Sony roughly $178 million in lost profits.

Failing to make the cut for the May 26^th House calendar, Senate Bill 1628 is dead.  
 

We recently predicted cyber insurers would attempt to avoid coverage on grounds the insured failed to implement appropriate security protocols. Regrettably for policyholders, that prediction is already becoming a reality.

Last week produced one of the first published cases interpreting a cyber insurance policy—in Travelers Prop. Cas. Co. of Am. v. Federal Recovery Services, Inc., No. 14-170 (D. Utah). Granting Travelers’ motion for partial summary judgment, the district court on May 11 decided the cyber policy was not triggered and the insurer had no duty to defend its insured.

Congratulations to Amy Stewart Law Managing Principal Amy Elizabeth Stewart and Principal Tarron Gartner-Ilai, who were both named to D Magazine’s 2015 listing of the Best Lawyers in Dallas based on their expertise in insurance law.