(Editor's Note: The following article has been contributed by David M. Governo and Corey M. Dennis of Governo Law Firm LLC, an 18-attorney law firm in Boston, Mass.)
No business today is immune from the threat of a costly data security breach. While cyber liability insurance is becoming a recommended element in mitigating the financial exposure associated with such breaches, which are estimated to cost between $3.7 million and $5.5 million per incident, businesses have found coverage under traditional insurance policies in some limited circumstances.
The U.S. Court of Appeals for the Sixth Circuit recently held in Retail Ventures, Inc. v. Nat'l Union Fire Ins. Co. of Pittsburgh, Pa., 691 F.3d 821 (6th Cir. 2012), that DSW Inc., DSW Shoe Warehouse, Inc., and Retail Ventures, Inc. (an affiliated company) were entitled to coverage under a commercial crime policy for a $6.8 million loss resulting from a cyber attack.
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