Case Studies

Global Manufacturer:

Crime Insurance

Insurers taken to task for relying on the small print of a policy to decline part of a major claim

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Global Manufacturer: Crime Insurance

Background

Our client suffered a large loss due to crime when a member of staff managed to steal several hundred thousand pounds over a number of years.

Problem

The theft loss was paid but our client was left significantly out of pocket as the insurer refused to pay for the fees of the forensic accountants it had been necessary to employ in order to track and quantify the loss. The insurer argued that these fees had been incurred without their “prior consent”, as specified in the policy and refused to pay them.

What we did

We argued long and hard that this was unfair. The accountants were instructed from our client’s overseas head office, without them realising that there was a policy in the UK which would cover the loss sustained. While they had acted promptly to deal with the situation, they failed to check that there might be an insurance solution and engage with the UK operation before acting. We argued that the insurer was unfairly relying on small print to get out of contributing to cost of the forensic accountants.

Outcome

The insurers finally conceded that the accountancy fees could be recovered as “fraud investigation fees” and paid our client an additional £50,000, which was the full limit for such fees under the policy. This was an excellent outcome.