Judges Skeptical of Insurance Coverage for Privacy Breaches (1)

Questions from a panel of federal appellate judges on Wednesday favored the view of an insurance company arguing that the wording of its policies exempts coverage for violations of an Illinois privacy statute.

Thermoflex Waukegan LLC faces millions of dollars in losses due to a class action alleging it violated the Illinois Biometric Information Privacy Act, which prohibits private employers from collecting data such as iris scans or fingerprint images from workers without their consent. It notified its insurer, Mitsui Sumitomo Insurance USA Inc., of the class action but the insurer refused to indemnify Thermoflex. Mitsui claimed exemptions contained ...