You’ve probably heard of someone who has lost money to a scammer who pretends to be a vendor, client or company executive. Officially called social engineering fraud, such scams have unfortunately, become all too common.
Let me share a story that we experienced with one of our customers recently.
Our client, we’ll call him Joel, imports products from China and sells them here in the US. As is common when dealing with factories in China, he gets wiring instructions by email and needs to pay a deposit before his products are manufactured.
One day last month, Joel got an email with wiring instructions for his deposit of $15,000. As usual, he wired the funds as requested by the vendor. Except this time the vendor’s email was hacked! The request for $15,000 came from someone pretending to be his vendor. And the money went to the scammer!
By the time Joel was notified, the thief had already withdrawn the funds, and there was no way to retrieve his money.
You might think that a cyber insurance policy would help someone like Joel recoup his money. After all, the thief worked thru email. Until quite recently, however, there was no insurance coverage for scams like the one Joel experienced. Being that the money is sent voluntarily by you or your employee, coverage is excluded.
New Opportunities in Cyber Coverage
Here at Adler's Insurance, we constantly keep up with new changes and developments in insurance. Scams like these are unfortunately becoming more common and insurance companies are stepping up to provide coverage.
Social Engineering is an endorsement which can be added to cyber insurance policies. This coverage is now available to most businesses and will protect your company from a loss of as much as $100,000 or more. Prices start at about $600; don't wait until it's too late!
Till next time,
The Adler's Insurance Team