Testimonial!

"Our board was experiencing serious concerns about the percentage of the organization's budget allocated to insurance costs. After some online research, we found Scott Simmonds--and what a great find he has been! Thanks to Scott's efforts, insurance costs have been reduced dramatically, and coverage improved. He worked extremely well with the board and our current agent--we were completely satisfied and would definitely use Scott's services again--and recommend him to anyone in a similar situation."


Billie Bailey
Executive Director
Grout Museum District
Waterloo, Iowa

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Insurance Matters: Property Insurance Issues Part 2

My February column for CU Management...

More property insurance issues for credit unions - See the column here.

Flood insurance
Earthquake coverage
Computers

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FDIC and Professional Liability Lawsuits

I do a lot of work with banks. I subscribe to FDIC news notices.

This one (2/10/2011) made my blood run cold... Something about the tone... Obviously I knew that FDIC goes after bank directors. However!


Professional Liability Lawsuits

As receiver for a failed financial institution, the FDIC may sue professionals who played a role in the failure of the institution in order to maximize recoveries. These individuals can include officers and directors, attorneys, accountants, appraisers, brokers, or others. Professional liability claims also include direct claims against insurance carriers such as fidelity bond carriers and title insurance companies.

The FDIC follows the policies adopted by the FDIC Board in 1992, Statement Concerning the Responsibilities of Bank Directors and Officers, which can be found at http://www.fdic.gov/regulations/laws/rules/5000-3300.html#fdic5000statementct, and require Board approval before actions are brought against directors and officers.

Professional liability suits are only pursued if they are both meritorious and cost-effective. Before seeking recoveries from professionals, the FDIC conducts a thorough investigation into the causes of the failure. Most investigations are completed within 18 months from the time the institution is closed. Prior to filing the claim, staff will attempt to settle with the responsible parties. If a settlement cannot be reached, however, a complaint will be filed, typically in federal court.

FULL NEWS RELEASE HERE

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Nonprofit Directors and Officers Insurance - Article

Many nonprofits wonder if directors’ and officers’ liability insurance is a must-have, just like bylaws or a conflict-of-interest policy, especially as even the smallest organization will have to pay upward of $1,200 per year for it.

Directors’ and officers’ liability insurance—known as D&O insurance—is protection against a breach of duty by the directors and officers. D&O pays for what the policy calls wrongful acts: "Any actual or alleged act or omission, error, misstatement, misleading statement, neglect or breach of duty by an insured person in the discharge of his/her duties."

Read my full article here at www.MassNonprofit.org.

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Testimonial!

I have the greatest clients!

"Scott Simmonds was a valuable resource when we went out to bid on the district’s insurance policies. Having never been involved in the insurance bid process, I was pleased with the knowledge and insight that Scott brought to the table and his ability to bring us up to speed as to how the process of insurance bidding is carried out. During the selection process, he gave us ongoing advice and was able to help us bottom line the choice that would best serve the district, balancing both the financial considerations and the need to maintain a successful working relationship with an insurance carrier."

Sue Lambert, Director of Business & Finance
MSAD#49, Fairfield, ME

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Employed Lawyers E&O

Attorneys in private practice buy errors and omissions insurance. Such is coverage for suits brought by clients for malpractice.

When attorney goes to work for a private firm the need for errors and omissions insurance drops to almost zero - an employer can not sue an employee for malpractice.

I said almost zero.

Employed lawyers sometimes continue to handle small matters for friends and family. They may help employees with wills or other small legal matters. The lawyer is exposed to a lawsuit if those "off-the books" issues result in a lawsuit.

Employed attorneys should realize that most employers do not buy coverage for them for malpractice.

There is an insurance policy designed for this situation - called Employed Lawyer E&O.

Talk with your insurance advisor about employed lawyer errors and omissions for more info.

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