Insurer Sues To Duck $1M Patient Data Breach Settlement

Dan Packel reports that once again, an insurance company is suing for judgement that it is not liable for covering its insured over a data breach:

Peerless Insurance Co. filed suit in Pennsylvania federal court Thursday to get out of covering losses for a company that mishandled patient medical records when relocating a clinic acquired by hospital operator Select Medical Corp., causing Select to pay $1 million to Texas health authorities over privacy claims.

Read more on (subscription required). The case is Peerless Insurance Co. v. Martin Enterprises, LLC, and I’ve uploaded part of the complaints to (free account/login required). If you don’t remember the case, you can find a recap in this press release from the Texas Attorney General’s Office and this follow-up in Lubbock Online. Martin Enterprises, LLC had not been named in any of the coverage I had seen at the time, but David Martin was allegedly hired by Select’s contractor to oversee the relocation of facilities. According to the insurance carrier’s complaint, the day after he was allegedly on-site, the records with PHI and PII were found in a dumpster.

In seeking declaratory judgement, the insurance company similarly sued Select Medical Corporation and Select Physical Therapy.

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