There’s a saying along the lines of,
your insurance is
only as good as your last claim…
This saying rung very true recently for one of our clients
with a difficult claim.
A successful Perth-based technology company operating for
over 20 years and a client of Westralian Insurance for the past 10 years, this
small to medium enterprise operates in a niche technology sector and is growing
consistently every year.
What happened?
In the summer of 2018, cyber criminals hacked into the emails of a trusted customer of our
client. The criminals then impersonated the customer and placed a large order
of goods for immediate delivery. Not
thinking anything was wrong (as the email appeared to come from the customer),
our client dispatched the goods the same day. The error was not picked up until our client
chased their customer for payment and discovered that no authentic order was
ever placed.
The order contained high value equipment totalling
$50,000 in value and potentially could have put the client out of business.
After paperwork was lodged, the insurers originally rejected
the claim on the basis that it was a “first party loss”, meaning that no third
party was making a claim against our client. However, after a thorough review of the
Professional Indemnity and Cyber Insurance sections of our client’s policy
wording by our insurance broker, we were able to successfully overturn the
original decision and the claim was paid out in full.
Interestingly, the third-party trigger for the claim became
the client’s supplier who had not been paid for the equipment which was shipped
to the criminals. Their demands to our
client for payment became the third-party trigger for the claim. This would have been a difficult claim for the
company to deal with directly and clearly shows the value of engaging an
insurance broker for your Business Insurance.
