Fiduciary Liability Coverage Misunderstandings

In your bank's management liability insurance program is (should be) coverage for errors made in the administration of YOUR employee benefit plan as described in the federal law, ERISA.  This coverage section is almost always called "Fiduciary Liability." The word "fiduciary" refers to your liability under ERISA, as an employer. This is not … [Read more...]

Check-Kiting Scheme Costs Millions

Frankly, I thought check kiting was a thing of the past with current technology and holds put on funds. I guess not... TOPEKA, KAN. - The owners of the Plainville Livestock Commission in Rooks County are charged with carrying out a check-kiting scheme that cost banks millions of dollars, U.S. Attorney Stephen McAllister said ...   (Full Article) … [Read more...]

Gifts, Trips and Gratuities

An insurance agent sent me an invitation today to an annual party-boat trip they sponsor for clients.  I'm sure it is a fine time and appreciated by many of their customers.  I declined, as I always do when offered gifts. "I appreciate your offer but must decline.  It is my client's expectation that I remain completely unbiased in my advice and … [Read more...]

Insurance Renewal Best Practice

Another name for your insurance renewal could be "The Annual Insurance Affliction." Start thinking about your renewal five months before it happens. Consider what you want the outcome to be. -Do you want quotes from other agents? -Do you want quotes from other insurers? -Do you want quotes in-hand thirty days before your current … [Read more...]

Surprise! Insurance Agents Recommend Buying Insurance

I have had four conversations today with insurance agents.  In all cases the agents wanted my clients to buy more insurance.  More, more, more, more. There is never enough insurance purchased. There is never a reason to lower limits. There is never a premium savings worth increasing deductibles. No risk is too small to recommend the purchase of … [Read more...]

Semantical Bank Insurance Silliness

For the 238,000th time, I have been asked why insurance is so unnecessarily complicated... I have no good response. In 40 years I never have. Probably will not 40 years from now. Regulators and some insurers call two different policies "Mortgage Errors and Ommissions." The first is coverage for a borrower who fails to buy insurance after you … [Read more...]

Fraud-Bond – Money In Transit Coverage

Your bank’s fraud-bond includes protection for transportation of cash when the cash is in the possession of an armored car company or an employee.  You are not covered for contracted messengers, taxis or other delivery services when cash is lost, stolen or misplaced. Of course, your messenger service may offer coverage or agree to protect you. … [Read more...]

Pollution Insurance for Lenders

I recently learned more about Beazley Group's pollution liability and clean-up insurance coverages. Here are some highlights of this coverage: - The policy is in the name of the lender only - it protects the bank's interest in the property. - Coverage is provided on a single-loan basis only. Have a loan where you are concerned about … [Read more...]

Pollution Liability Insurance For Lenders

An almost universally uninsured exposure for most bankers is liability and cleanup costs for REO properties found to have pollutants. The specialty insurer Beazley announced that it has an insurance solution, "Site Lender Environmental Asset Protection." I have no details yet. I have reached out to the insurer. More when I know it. Their … [Read more...]

Employee Dishonesty/Fidelity Insurance – The Fraud Bond

The employee dishonesty section of the financial institution fraud-bond is often called “Coverage A,” as it was designated as such in the original “Form 24” bond used in the early part of the 1900s. Coverage is provided for dishonest or fraudulent acts committed by employees acting alone or in collusion with others—such as embezzlement. The … [Read more...]