The Chubb Group of Insurance Companies has developed an errors and omissions (E&O) insurance policy for large financial institutions. BPL for Financial Institutions addresses traditional banking exposures such as deposit-taking and loan-making but can also respond to emerging fee-for-service exposures.
“As competition intensifies, the financial service industry continues to experience rapid change. The introduction of new banking products and services—such as broker/dealer operations and insurance operations—that extend beyond ‘traditional’ banking operations has left many financial institutions exposed to new professional liability exposures,” said Vic Stewman, vice president, Chubb & Son, and banking sector manager for Chubb Specialty Insurance. “Chubb’s BPL for Financial Institutions represents the next generation of E&O insurance protection for banks and other financial institutions.”
BPL for Financial Institutions provides customers with several options to address emerging fee-for-service operations. Coverage options include:
* Securities Broker Dealer Endorsement provides insurance for misleading sales practices and documents, improper advice, “unsuitable” customer products, inadequate disclosure, failure to execute trades properly and conflicts of interest.
* Insurance Agents or Insurance Brokerage Endorsements insures for conflicts of interest, misleading sales practices, improper coverage advice, errors in placing insurance overages and in determining proper coverage or coverage limits, and failures to report all insureds to the carrier.
* Lending Liability Endorsement provides insurance for breach of contract, violations of the Truth in Lending Act, failure to grant an approved loan, interference with a customer’s business, and wrongful foreclosure on a loan or repossession of collateral.
* Data Processing Services Endorsement provides protection for errors in coding or in routing processed checks.
Chubb’s BPL for Financial Institutions also offers these coverage highlights:
* Definition of “customer” includes the named beneficiary of any account held by the organization’s trust department who is entitled to receive professional services.
* Expanded definition of “insured persons” includes directors and officers, full-time, part-time, temporary, leased or seasonal employees, and volunteers. Coverage extends to the assets of spouses or domestic partners of insured persons.
* Punitive or exemplary damages are insurable where allowed by law.
* Noncancelable by the insurer except for nonpayment of premium.
BPL for Financial Institutions is designed for institutions with more than $3 billion in total assets.
Chubb, a provider of specialty liability insurance products and services for professionals in public, private and not-for-profit companies, has offered specialized insurance solutions to financial institutions for more than 40 years.
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