SR 19-12 Federal Reserve and D&O Insurance

As an insurance consultant to over five hundred banks around the US, I have fielded a fair number of questions and requests regarding the release of SR 19-12 in July. In this article, I will attempt to provide some clarity on my position and how your bank can understand the protections offered by your directors' and officers' insurance … [Read more...]

Dishonest Acts and Employee Dishonesty Coverage

Some version of this question comes up with some regularity. "We just learned of something an employee did in the past. Does this affect our bank's insurance coverage?" I ask the caller what the employee did. The replies I have heard recently are: -Cheated on income taxes. -Got caught shoplifting. -Forged a signature with intent to … [Read more...]

Banking for Marijuana / Cannabis Related Businesses

I'm spending some time thinking about the insurance issues raised by banks working with customers in marijuana-related businesses. I have polled several insurers and have been talking with my clients about the issues. I have also been studying insurance policy exclusions and restrictions, looking for trouble. I have found some. If your bank … [Read more...]

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...]

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...]

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...]

Builders’ Risk Insurance

The builders’ risk insurance policy covers buildings during construction, renovation, or repair. Insurance is provided on the structure and materials used in construction. In most cases, materials are covered while in transit, at temporary storage locations, and while stored at the job site. The following are some of the issues to consider. Who … [Read more...]

Bank Breach – Debit Card – Update

In August I put out a post on my take of the VA bank $2.4m debit-card/hack event.  (See that post here.) Over the past three months, I have more information and have changed my thinking slightly. First, I have no more info on the actual event or the claim with ABA/Everest. As I said before, the bank is not a client and ABAIS is obviously not … [Read more...]