Because banks are not static, exposures can quickly change, especially with all of the technological advances being faced today. Often banks may find that their current coverage might not be keeping pace with their evolving exposures or with available coverage. This is especially true with emerging and evolving cyber liability issues impacting industries and entities across the board.
As a banker, or banking institution, you may require help in determining the optimal coverage needed for your bank. Topics such as electronic transfer of funds, network and information security, regulatory exposures, and professional services performed should enter into the discussion in order for you to understand and be aware of any potential exposures. There are specific coverages that address your banks unique requirements. Professional Liability Insurance for Bankers needs to be at the forefront of any discussion concerning coverage needs.
Why you need a professional liability policy
The scope of any coverage available can vary widely from policy to policy, so its vital that you obtain expert advice concerning the specific circumstances of your organization. A bankers professional liability policy provides coverage to the company, its directors and officers, along with the employees for any actual or alleged wrongful acts in performing or failing to perform professional services for your customers.
Anytime that a fee and a written contract are involved you’re going to need a policy that addresses accusations of errors, mistakes, or wrongdoing associated with your banking procedures. This coverage also includes lender liability. The policy being discussed is a type of errors and omissions (E&O) coverage written for banks and financial institutions. The policy will cover economic losses resulting from mistakes committed in providing financial services that include, but are not limited to, providing services such as wire transfers or acting as an escrow agent.
In addition, other services being covered include tax or estate planning, acting as trustee under a bond indenture, or providing electronic data processing services. What wont be covered under Professional Liability Insurance for Bankers are fraudulent or dishonest acts, deliberate violations of laws or any other criminal acts. It also doesnt cover claims that are pending at the time the policy is taken out, nor does it coverlibel, slander, defamationor invasion of privacy.