Banks – Professional Liability Notary Services Exclusion

Bankers, a reminder about most insurance company's professional liability coverage... Most insurers exclude lawsuits that come out of notarized signature when the person signing the document did not appear personally before the notary. You'd think it was a given that notaries would have to have the guy standing in front of them in order to … [Read more...]

Wage/Hour Claims

Employees suing you for back overtime pay is not covered by most Business insurance programs. So-called wage hour or fair labor claims are excluded by both general liability insurance and in most cases employment practices liability insurance. Some employment practices policies cover defense costs in such claims. This is certainly not the … [Read more...]

Bank Director Gross Negligence vs Ordinary Negligence and FDIC

When a bank fails, the FDIC wants to get its money back.  There is a common pattern of the FDIC going after the directors of failed banks.  Currently the FDIC has to show "Gross Negligence" before doing this. They want to lower the bar to "Ordinary Negligence." Bank associations and bankers are mostly against this change.  The American Bankers … [Read more...]

More (Though Not New) Thoughts on Bank Civil Money Penalties Insurance

A client asked about my knowledge of the history of civil money penalties against bank board members. The question was prompted by a note I sent about AmTrust's CMP insurance policy. My Reply: CMP against banks seems to be mostly for issues of lack of flood insurance on loan collateral that is in flood areas. CMP against directors is exceedingly … [Read more...]

Is Your Bank Covered For Cyber Fraud?

My latest article for Banking Exchange...  E-Banking insurance issues are by far the most common question-topic I get from bankers.  Cyber liability insurance, cyber crime, e-hacking, etc. The arms race that is computer security goes on and on. As your fraud prevention systems get better, the bad guys get better at being bad. Your insurance must … [Read more...]

AmTrust Offers FDIC-Friendly Civil Money Penalties Cover For Banks

I got word yesterday that AmTrust is now offering a stand-alone Civil Money Penalty (CMP) insurance policy for banks. -Coverage is applied for by the individual director or officer. -Coverage is paid for by the director or officer. -Bank is referenced on the policy but only to define the activities covered for the individual.  The bank is … [Read more...]

End of the World Insurance

I call excess side A coverage on directors' and officers' insurance policies, "end of the world insurance." Your company's by-laws includes an indemnification agreement that says that the company will pay for any litigation against a director or an officer over their service as a Director or Officer. (Note: There are legal restrictions on what … [Read more...]

Civil Money Penalty Insurance

Since the FDIC came out with their October 2013 letter clarifying/trashing the use of insurance to protect bank directors and officers from civil money penalties there has been a great deal of heat generated by discussion.  Not much light - lots of heat. About two years ago I saw the whole thing coming and started telling my bank clients to … [Read more...]

Banks In Trouble Find It Hard to Get Sound Insurance

A bank client shared some info that the FDIC is looking to warn banks that there are exclusions in some bank directors' and officers' insurance for regulatory issues. My experience is that these exclusions are almost always only on banks with regulatory issues. In general, insurers are not looking to sell insurance when the chances of a claim are … [Read more...]

Notary Public Professional Liability Insurance Banks

A client sent me the following questions about notary public professional liability insurance: Are employees who perform notary services for bank customers insured against errors they make?  Would that fall under Professional Liability coverage, or is it a specialty insurance? My reply: When they are performing services related to their … [Read more...]