Loss of source code excluded from insurance policy

The case concerned Tektrol Limited, a provider of energy saving control devices for industrial motors, and the source code for the software upon which these devices relied. While Tektrol had taken several precautions to protect the code, two unrelated events - the corruption of the code through a virus on both office equipment and that housed at a remote location as well as a burglary in which computers housing uncontaminated code were stolen as well as the hard copy of the code - resulted in the code being completely lost. Tektrol claimed on its insurance for the business interruption caused by the losses, however, the policy excluded consequential losses resulting from erasure, loss, distortion or corruption of information on computer systems as well as consequential loss for theft. The judge found that the exclusions applied to Tektrol\'s claim. Full Out-Law.com report