10. Target sues Chubb for data breach coverage
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Fallout from the landmark 2013 data breach of Target Corp.’s systems continued to be felt in 2019.
The breach, where credit card information of the retailer’s customers was exposed after cyber criminals accessed it via an HVAC system, has widely been used as an example of how cyber exposures have grown for corporations over the past decade.
Target had cyber coverage and other coverages that could potentially have responded to breach claims.
Target also claimed on its general liability policy with Chubb Ltd. After the insurer refused to indemnify it for part of the cost, Target filed suit in federal district court in Minneapolis in November.
The story about the lawsuit was the 10th most read risk management story on Business Insurance’s website in 2019.
Target was seeking to recoup up to $74 million of its costs. The Minneapolis-based retailer said because the banks had to replace plastic payment cards it constituted “loss of use of tangible property that is not physically injured” under its general liability coverage.
Chubb denied Target incurred any losses that were covered under its policies in a Dec. 16 response that was filed with the court.
The data breach exposed the payment card information of some 110 million customers. In May 2016, Target reached a settlement of about $58 million in a class action lawsuit brought on behalf of a class of issuing banks, according to the lawsuit.
Adding in confidential settlements with major card issuers as well as numerous individual issuing banks led to a total settlement of about $138 million, of which about $118 million was paid to the issuing banks, and the remaining $20 million paid in attorneys fees and class representative payments, according to the lawsuit.
