It’s one thing to update a breach report with a notice of lawsuit settlement, but it’s another to realize you never covered the original breach at all. Let’s remedy that now.
On February 27, 2021, Zywave and its subsidiary, Insurance Technologies Corp (ITC) suffered a data breach. From a press release by plaintiff’s counsel:
Cybercriminals allegedly made off with the names, Social Security numbers, driver’s license numbers, usernames, passwords, and other identifying information belonging to not only the companies’ clients, but their clients, mainly small insurance agencies, potential customers as well.
The breach was first disclosed on May 10, 2021, two months after the firm allegedly completed its investigation. The delay in notification was one of the claims made by the plaintiffs. More than 4 million people were potentially impacted.
Now Zywave has agreed to pay $11 million to settle the claims that it and ITC failed to protect the personal information of over four million customers. Counsel
also asked the court to establish three separate tiers of relief: a “tier one” fund paying $100-$300 to approximately 318,091 California subclass members; a “tier two” fund providing reimbursement of up to $5,000 in out-of-pocket expenses per class member, which includes $25 per hour for up to eight hours of attested lost time; and a “tier three” fund providing every settlement class member 12 months of Aura’s Financial Shield product, which offers a $1 million protection policy to every subscriber and focuses on protecting financial assets.
Only those California subclass members whose Social Security number and/or driver’s license information were accessed or potentially accessed during the breach, as confirmed by Insurance Technology’s business records, will be eligible to submit a tier one claim.
In order to qualify for a tier two reimbursement, class members will need to provide documentation supporting their claim, a brief description of the loss and information needed to verify the claim, including their name and mailing address, which will also be checked against Insurance Technology’s business records at the time of the breach.
Out-of-pocket losses will only be covered if the timing of the loss occurred on or after February 27, 2021, and the personal information used to commit the alleged identity theft or fraud was the same type of personal information provided to Insurance Technology before the breach.
The case is Heath et al. v. Insurance Technologies Corp. et al., Number 3:21-cv-01444-N, in the U.S. District Court for the Northern District of Texas.
Read more at Mason Lietz & Klinger.