The underlying message to all insurance carriers is that they must make policy exclusions and conditions crystal clear to customers. Photo: Yurii Kibalnik/Adobe Stock The underlying message to all insurance carriers is that they must make policy exclusions and conditions crystal clear to customers. Photo: Yurii Kibalnik/Adobe Stock

In June 2017, a small vulnerability in a Ukrainian accounting software led to what was possibly one of the most destructive and damaging cyberattacks of all time — the NotPetya. One of its most notable victims was U.S.-based pharma giant Merck, which suffered nearly $870 million in damages and $400 million in lost sales as a direct consequence of the attack.

Once the dust settled, Merck filed a property insurance claim. To the company’s surprise, its insurer, Ace Insurance (Ace), did not honor the policy even though Merck’s policy covered “all risks.” Ace argued that since this was an “act of war” (by Russia), a U.S. insurer is exempted from covering damages related to such acts of war. In a recent landmark judgment, however, a U.S. appellate court rejected Ace’s arguments and awarded Merck with a $1.4 billion payout.

Want to continue reading?
Become a Free
PropertyCasualty360 Digital Reader.

INCLUDED IN A DIGITAL MEMBERSHIP:

  • All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.

Already have an account?


NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

PropertyCasualty360

Join PropertyCasualty360

Don’t miss crucial news and insights you need to make informed decisions for your P&C insurance business. Join PropertyCasualty360.com now!

  • Unlimited access to PropertyCasualty360.com - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including BenefitsPRO.com, ThinkAdvisor.com and Law.com
  • Exclusive discounts on PropertyCasualty360, National Underwriter, Claims and ALM events

Already have an account? Sign In Now
Join PropertyCasualty360

Copyright © 2024 ALM Global, LLC. All Rights Reserved.