Chubb Launches Crime Coverage for Payment Fraud

The Chubb Group of Insurance Companies has created a crime insurance endorsement to help protect companies from an increasingly prevalent type of fraud. Chubb’s Social Engineering Fraud Endorsement provides coverage for an organization’s losses when an employee is tricked into making a payment through email, telephone, letter or other means to someone who purports to be a vendor or client.

Coverage is available up to $250,000 per occurrence with no annual aggregate, although higher limits may be available to qualified customers.

Greg Bangs, vice president and worldwide crime insurance manager for Chubb, said that a typical crime insurance policy will not insure an organization for such fraud losses. He noted that crime policies respond when money or securities are taken by a third party, but a social engineering scam tricks employees into sending money or securities to a fraudster.

“As organizations continue to seek to improve their computer security, social engineering scams are taking aim elsewhere – at human beings,” said Bangs. “It’s easy for a thief to pose as a vendor and request by email that a payment be directed to a new bank account. The company may not realize it was defrauded until weeks or months later when the vendor sends out an overdue payment notice.”

The endorsement can be added to the crime insurance coverage section of the following Chubb policies: Executive Protection Portfolio, Health Care Portfolio, ForeFront Portfolio for Not-for-Profit Organizations, and Forefront Portfolio 3.0.

Members of the Chubb Group of Insurance Companies provide property and casualty insurance products to customers around the globe. These products are offered through a worldwide network of independent agents and brokers.