Travelers Bond, a division of Travelers Property Casualty Corp., has extended its fiduciary liability policies to provide a sublimit of coverage for civil fines and penalties assessed under the Health Insurance Portability and Accountability Act (HIPAA).
In response to HIPAA, the Department of Health and Human Services (HHS) required compliance with the Standards for Privacy of Individually Identifiable Health Information (the Privacy Rule) by April 14, 2003. This Rule is designed to protect certain information related to an individual’s health and health care that may be in the hands of a health care provider or a health care plan. The Privacy Rule restricts the use and handling of Protected Health Information (PHI).
Since the Rule applies to health plans, it has implications for employers who provide and maintain those health plans for their employees. Violations of the Privacy Rule can result in civil penalties of up to $100 per violation, and up to as much as $25,000 per year.
Travelers Bond’s new endorsement to its fiduciary liability insurance policies specifically provides coverage for civil penalties assessed under HIPAA. The endorsement is available on Fiduciary Liability PLUS+®, Travelers Bond’s stand-alone fiduciary liability policy, and on fiduciary liability coverage purchased under The WRAP(SM), Travelers Bond’s executive liability package policy, or The Advantage(SM), an executive liability package policy for financial institutions.
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