HNRK Coverage Corner

On May 1, 2023, the New Jersey Superior Court, Appellate Division, issued a decision in a closely-watched cyber insurance case, Merck & Co, Inc. v. ACE Am. Ins. Co., Appellate Division Docket No. A-1889-21, A-1882-21. (I spoke to Law360 about the case in January.)  Affirming the trial court’s ruling in favor of the policyholder, the appellate court held that an exclusion in an all-risk insurance property insurance policy for damages arising from “hostile or warlike action” by a “government  or sovereign power” did not apply to a cyberattack on a private company ...

On December 27, 2022, the Ohio Supreme Court issued a decision in EMOI Servs., LLC. v. Owners Ins. Co., 2022-Ohio-4649 (Ohio 2022), holding that losses resulting from damage to an insured’s software were not covered under the “Electronic Equipment” endorsement of a property insurance policy.

The insured, EMOI Services, is a computer software company whose product “provide[s] medical offices with service and support for setting appointments, record keeping, and billing.”  EMOI fell victim to a ransomware attack and was forced to pay a $35,000 ransom in exchange for ...