Social engineering fraud coverage, defined

The trick is the point: because an employee authorized the payment, the standard computer fraud and funds transfer agreements, which require an unauthorized intrusion, do not respond. This endorsement, offered on crime and cyber policies, pays when the transfer was induced by a fraudulent instruction. Limits are usually much lower than the rest of the policy, and carriers often require a call-back procedure to verify any change in payment instructions; a loss where the procedure was skipped may be reduced or denied. Common patterns are a fake invoice with new bank details, a spoofed email from the owner asking for an urgent wire, and an impostor customer requesting shipment to a new address.