AIG Unit Seeks to Dismiss Lawsuit Over $5.9 Million in Online Losses
October 29, 2019 by AM Best
NEW YORK – AIG Specialty Insurance Co., a unit of American International Group Inc., has asked a federal judge to rule that the company does not have to cover $5.9 million in losses incurred by a policyholder attacked by suspected Chinese fraudsters.
Attorneys for the company asked Judge Jed S. Rakoff, of the U.S. District Court for the Southern District of New York, to dismiss the lawsuit seeking coverage by SS&C Technologies Holdings Inc. The tech company argued the AIG special professional liability insurance policy covered losses it suffered when employees mistakenly transferred money to the fraudsters via fake transfer requests.
The special professional liability insurance purchased by SS&C Technologies does not cover losses stemming from criminal activity, according to a motion filed by AIG attorneys.
“Words matter,” the motion said.
SS&C Technologies’ “arguments ignore the actual language of the policy at issue here,” the AIG motion said.
“Under the clear and unambiguous language of AIG Specialty’s policy, indemnity coverage (the only coverage at issue in SS&C’s complaint) is excluded for claims ‘alleging, arising out of, based upon or attributable to a dishonest, fraudulent, criminal or malicious act, error or omission, or any intentional or knowing violation of the law,’” the motion said.
Attempts to reach attorneys for SS&C Technologies for comment were unsuccessful.
In July, a Delaware state judge ruled against AIG Specialty Insurance Co. and Lexington Insurance Co. in a dispute over whether they were obligated to cover the costs incurred by a policyholder in response to a fraud investigation by the Texas attorney general (Best’s News Service, July 9, 2019).
AIG Specialty Insurance Co. has a current Best’s Financial Strength Rating of A (Excellent).
(By Frank Klimko, Washington correspondent, BestWeek: Frank.Klimko@ambest.com)
BN-NJ-10-10/29/2019-2019 1020 ET #