Wire fraud insurance: what you need to know for 2025

A title agent in Michigan received devastating news last year.

Her company had just wired $780,000 to what turned out to be a fraudster's account. 

"We had insurance," she said, "But they're denying the claim because it was social engineering, not a direct system breach."

This alarming story highlights a sad reality for professionals across the industry: as fraud techniques evolve, insurance coverage gaps are leaving businesses exposed to financial losses.

According to our State of Wire Fraud 2025 report, in 2024, reported losses to the FBI Internet Crimes Complaint Center (IC3) exceeded $12.5 billion, with real estate wire fraud accounting for an estimated $500 million of that total.

Key trends and stats are also concerning:

• 17% of title companies experienced wire fraud.
• Seller impersonation scams & social engineering and high-profile fraud cases are on the rise.
• Law firms are increasingly targeted, with attorney-client privilege complicating fraud prevention.

These changes need businesses to act now. 

The question isn't whether to improve your wire protection, but how to do it.

The answer lies in combining specialized insurance with prevention technology to provide adequate security for your business.

Understanding wire fraud insurance

Wire fraud insurance helps protect businesses from losses due to wire transfer fraud. It's available through commercial crime or cyber liability insurance policies (we’ll talk more about these in the upcoming sections.)

While not typically sold as a standalone product, this coverage is essential for title companies and law firms handling large digital funds transfers.

How does wire fraud insurance work?

Wire fraud insurance provides financial protection when criminals trick your business into sending money to fraudulent accounts.

The coverage typically activates after you've discovered the fraud and reported it to your insurance carrier.

Wire fraud insurance coverage often includes:

1. Financial reimbursement: At its core, wire fraud insurance is used to cover funds lost due to fraudulent transfers. This can consist of money transferred under wrong pretenses or through impersonated or compromised email accounts.
2. Legal fees: Wire fraud incidents often lead to legal battles. Wire fraud insurance can cover the cost of legal advice and proceedings necessary to address the fraud.
3. Recovery and investigation costs: You often need digital experts or robust recovery measures to uncover fraudster complex tactics in a wire fraud case. This is sometimes covered by wire fraud insurance.
4. Crisis management: Some policies extend to cover crisis management services to help businesses recover from a fraud incident or restore the damage to their reputation.

Why is wire fraud insurance necessary?

Wire fraud insurance is becoming essential as wire fraud becomes more common and sophisticated across real estate transactions. Businesses, home buyers, and home sellers can fall victim to these scams even with rigorous security measures.

This insurance helps cover the financial losses if you’re a victim of wire fraud.

However, it's important to note that the consequences of wire fraud often go beyond immediate financial damage. They often induce lengthy, complex recoveries, reputational damage, and a lasting emotional impact for all impacted parties.

Nevertheless, as a business owner, it's a critical part of protecting yourself financially in a world where you do most of the transactions online.

Is wire fraud covered in your current insurance policy?

The short answer is: no, most general policies don’t cover your business when wire fraud happens.

To get an expert perspective on cyber insurance, we spoke with Jonathan Biggs, Vice President & Director of Risk Management & Education at Investors Title Insurance Company, and Chad Gaizutis, Vice President at Stateside Underwriting Agency, to break down industry policy changes and coverage updates you should know before your next renewal.

Here's what they had to say about it in a recent webinar:

The reason for the lack of coverage is because the wire transfer is often made after a social engineering attack, not as a direct result of cybercrime or a direct breach to your computer network or attack on your personnel.

The fraudster convinces the victim to voluntarily transfer money. So, technically, the fraudster does not directly use your computer to steal the money.

Often, the claim is made by a third-party such as a buyer who was tricked into wiring their "cash to close" to a fraudulent account. 

Given these claim features, the various policies may respond differently—which can lead to finger-pointing by the carriers if a claim is made and delay settlements.

And even if wire fraud is covered, it may still be subject to a sub-limit, according to your specific policy.

For example, socially engineered wire fraud may be specifically covered in a $1 million limit cyber policy.

However, in that same policy, it may be limited to $100,000 or $250,000 in a specific sub-limit and also carry a higher deductible.

In the wrong situation, the insured may still have a substantial loss even though they do have insurance in place.

Another trend that is in the market is a cyber "gap" policy which will add a limit to otherwise sub-limited policies on a secondary basis.

What to do instead?

Either look for insurance providers that tailor their offer to your needs (which can be rare and incredibly expensive) or partner up with a technology provider for fraud prevention and ask about your options. 

At CertifID, we provide wire transfer insurance.

To better understand your options to prevent wire fraud, let’s talk about types of real estate insurance in detail.

Types of real estate cyberinsurance & how they differ

Real estate professionals, including law firms, real estate agents, title agencies, and escrow/closing agents, face unique risks. This section breaks down the main types of insurance (and bonds) that can help protect against those risks.

Cyber insurance

One growing trend is for real estate professionals to separate data breach coverage from other professional liability or crime policies by purchasing cyber insurance.

Cyber insurance typically protects businesses from internet-based risks and divides coverage into first-party and third-party protections.

First-party cyber insurance coverage

Definition: Covers direct losses your business incurs due to a cyber incident.

If your business stores data—such as payment records, bank information, birth dates, social security numbers, and state-issued identity documentation—on computers in the cloud, it is at risk of a data breach.

Examples:

• Data restoration costs (if your systems are breached).
• Lost income if you can't operate due to the breach.
• Regulatory and notification expenses.
• Reputational damage control.

Why it matters: If your company stores sensitive client information (e.g., payment records, bank info, Social Security numbers), a breach can trigger major internal costs.

Third-party cyber insurance coverage

Definition: Covers liabilities if a third party (e.g., a client or partner) is harmed by a breach of your systems.

If a third party incurs damages due to a breach of data held on your computers, you may be held liable. Courts and juries are finding liability with greater frequency.

Examples:

• Legal defense costs if a client sues you for failing to protect their data.
• Settlements or judgments if you're found liable in court.

Why it matters: Courts increasingly hold businesses responsible for data breaches. Third-party coverage can shield you from crippling legal fees.

Errors & Omissions (E&O) insurance

Definition: Errors and Omissions (E&O) insurance is a distinct form of insurance that caters to different aspects of business risk. 

E&O insurance, which is essential to service-providing professionals, covers legal costs and damages resulting from unintentional professional negligence, mistakes, or oversight.

It's crucial for protecting against third-party claims of negligence or inadequate work.

Examples:

• Legal defense costs if a client sues you for professional mistakes
• Settlements or judgments if you're found liable in court
• Coverage for errors in professional advice or services
• Protection against claims of incomplete or inadequate work

Why it matters: While many consider E&O an "all-risk" policy, it doesn't often cover you for financial fraud. In most instances, title agents must carry E&O insurance as it provides critical protection against claims that could otherwise devastate a business financially.

Impact of wire fraud prevention on E&O costs: Some title companies have even seen reductions in their E&O insurance premiums after implementing wire fraud protection measures.

TitleSmart, Inc. reported their E&O insurance costs were reduced by half after adopting CertifID. Insurance carriers often recognize risk mitigation efforts like these through adjusted premium rates when companies demonstrate they've taken concrete steps to reduce fraud risk.

Fidelity bonds & escrow security bonds

Definition: Fidelity bonds, also known as escrow security bonds, are designed to protect a business from losses caused by theft, dishonesty, or fraudulent acts of its employees. 

This type of bond is particularly important for businesses that handle client funds or sensitive information.

Examples:

• Coverage for employee theft of client funds from escrow accounts.
• Protection against embezzlement by trusted team members.
• Reimbursement for losses due to forgery or fraud committed by employees.
• Recovery of misappropriated funds that could threaten your business license.

Why it matters: Internal fraud can devastate title agencies and escrow businesses, threatening both finances and licensing. With fewer agents carrying this coverage, having fidelity bonds provides critical protection against risks that other policies typically exclude.

What to look for in your wire fraud insurance

When evaluating wire fraud insurance for your title company or law practice, pay special attention to these critical policy elements:

• Policy wording: Check the policy for specific mentions of coverage for wire fraud, funds transfer fraud, or social engineering attacks.
• Sub-limits: Some policies have sub-limits, which means the insurance company will only reimburse up to a certain amount per incident, often much lower than the policy's overall limit.
• Deductibles: You may need to pay a deductible before your insurance coverage kicks in, which can significantly impact your out-of-pocket costs.

How to get wire fraud insurance

Finding the right wire fraud insurance for your title company or law firm requires knowing where to look. 

At CertifID, we offer direct first-party insurance coverage of up to $2 million per wire transaction as part of the wire fraud prevention platform.

‍Other providers also include Riebling Insurance Agency or Financial Guaranty Insurance Brokers (FGIB).

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The claims process: What you should expect

When fraud hits your business, the claims process typically unfolds like this:

• Fraud happens. Seller impersonation, business email compromise (BEC), or spear phishing.
• Fraud is discovered. Often when the recipient reports missing funds.
• Insurance is notified. Call the claims hotline (keep it on speed dial).
• Adjuster is assigned. They request extensive documentation.
• Investigation begins. Determines if the policy covers the fraud.
• Reimbursement follows (if covered). Often delayed.

Here's what you may not realize: this seemingly straightforward process can turn into a bureaucratic nightmare. 

In numerous cases, insurers have taken 8-12 months to make coverage determinations, leaving title agencies in financial limbo.

"We had to take out a line of credit just to keep operating while waiting for our claim to process," a title agency owner explained to us after their experience with a traditional E&O policy.

The effectiveness of your coverage depends entirely on the specific wording in your policy.

What should I consider when renewing my cyber insurance policy?

Before renewing your wire insurance policy, have a clear conversation with your insurance agent. Make sure your coverage aligns with your specific needs. This is especially important for title agents and real estate attorneys.

Here are a few questions you should consider:

Questions to ask before renewing your policy

Given the rapid responses by insurance underwriters, anything we say today will have changed in the next year. 

Take a look at questions that you should ask your insurer. 

How long has my E&O carrier insured title and attorney agents? 

Ask how long their error and omissions (E&O) carrier has been insuring title and attorney agents. This gives you an idea of their experience and expertise in your field. Consider finding an E&O carrier with five or more years of experience to ensure they best understand your needs.

Does my carrier have a vested interest in my business and this industry? 

Ask if the carrier has an interest in your business and/or the wider real estate industry to determine the quality and relevance of their coverage. You’ll want coverage from someone who knows your pain points and the finer parts of how your business operates. 

Does the title underwriter endorse the carrier?

It’s important to check if the title underwriter endorses the carrier, as this can indicate reliability and trustworthiness. 

Did you hear about them at a trade show? Do they engage with them frequently online or across their business? Relationships are important in finding the right long-term partner to protect your business.

Concerning title agents and real estate attorneys specifically, how many businesses do you place E&O, Fidelity Bond, and Cyber Liability for? 

This question will help you gauge their experience handling risks pertinent to your profession. Consider finding an agent that places at least 25 businesses in this space.

Do I have protection against owner/seller fraud? 

Seller impersonation fraud is increasing across the industry. Like other forms of wire fraud, most policies or carriers will not cover this type of fraud. This is another instance where fraud prevention technology is important to keeping you and your customers safe.

Does my policy exclude unintentional breach of title underwriting contract? 

Ensure you understand the exclusions of your policy. 

Ask if any specific clauses, such as an unintentional breach of the title underwriting contract, are not covered. 

Knowing the exclusions helps you assess the extent of your coverage and may influence your decision on whether to renew or seek additional coverage.

These questions will help you understand your policy comprehensively and ensure your insurance protects you against the unique risks of real estate wire fraud.

What are some steps to take before my next cyber insurance renewal?

Before renewing your cyber insurance, consider these four important actions.

1. Report potential issues early. If you think something might lead to a claim in the future—like a title policy claim—tell your insurance company about it now. You must also report any claims within your policy period. This helps keep your coverage up-to-date and effective.
2. Report claims quickly. If you need to make a claim, do it as soon as possible within your policy window and no later than 30 to 60 days after your policy ends. Quick reporting is important for your claim to be considered.
3. Know what your E&O covers. If there’s a problem caused by someone like an abstractor or surveyor you’ve hired, this usually falls under your Errors and Omissions (E&O) insurance, not your cyber insurance. Make sure you get your abstractor through your title underwriter.
4. Get the right bond. Make sure you have a Fidelity or Escrow Security Bond. These protect you against fraud or theft and differ from surety bonds, which are low-limit guarantees.

These steps will help ensure your wire fraud/cyber insurance is ready to protect you against online risks.

How to protect your business against wire fraud

Here are a couple of points on how to stay away from wire fraud:

• Use multi-factor authentication on all email accounts so fraudsters can’t get access to your account
• Verify wire instructions through secure wire prevention software—never via email.
• Implement wire fraud detection software to flag suspicious activity.
• Train staff and clients to recognize social engineering scams and urgent wiring requests.
• Use escrow security bonds for added protection.
• Confirm wire transfers through secure, trusted platforms.
• Verify vendor and client identities before processing payments.

Start with better wire fraud insurance coverage

The renewal season is the perfect time to clarify how wire fraud is covered under your current plan. 

Start by reaching out to your insurance broker to reevaluate your policies. 

Also, explore how technology can maximize discounts and enhance your scope of coverage. CertifID can provide better security measures, which insurance my reward with more favorable policy terms.

Another important note: As a CertifID customer, you are protected by our direct, first-party insurance policy.  This direct insurance policy provides access to the largest claim limits in the market ($2M per wire and $15M total aggregate coverage).

Reach out and understand how CertifID can help protect your business and minimize risk!

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