Insurance plan for financial institutions
Financial institutions are characterized by managing money for third parties and are exposed to many risks. Any risk that occurs may cause enormous damage and lead to tedious lawsuits against the company and against its officers.
The risks for financial institutions and their officers are from claims by investors, customers, embezzlement, cyber risks and regulatory investigations. This insurance plan is suitable for investment portfolio managers, investment consultants, investment houses, insurance companies, etc.
Board of directors and officers insurance
Protects the officers against personal claims against them filed by third parties for negligence in the management and supervision of the business. For example: investor claims, customer claims, employer-employee relations claims. Also, the officers’ policy also covers investigations by regulatory authorities.
Professional Liability Insurance (FIPI)
Insurance is very important and must be purchased at the start of the activity. Unlike officers’ insurance, professional liability insurance protects the company itself from problems presented by a third party due to negligence in the provision of its professional services.
There are many industries that are required to purchase insurance by law – portfolio managers, investment advisors, investment marketers, etc. Before purchasing the insurance, it is recommended to examine and adjust the required insurance by an attorney specializing in the field.
In light of the fact that most of the exposures of financial institutions may be exposures covered by the officers’ policy, it is advisable to find a plan that combines the professional liability policy and the officers under the same policy or alternatively purchase the policies from the same insurer.
Cyber insurance
In light of the continued increase in cyber incidents, financial institutions are at constant risk and may experience a cyber incident at any moment. Needless to say, one cyber incident can cause a huge loss to a company, its customers and its reputation.
The insurance protects the company from third-party claims as a result of a cyber incident (for example, claims for information leakage). The insurance also protects against a loss caused to the company itself as a result of a cyber incident (first-party coverage): loss of income as a result of the incident, payment of a ransom, initial response team (including: attorney, forensics and public relations), payment of reporting expenses according to regulations Various privacy (Notification Costs), expenses for regulatory investigations (CCPA/GDPR).
Embezzlement insurance – Crime Insurance
This insurance covers loss caused by embezzlement of funds or securities by company employees or third parties. Financial institutions that manage funds of third parties and even transfer funds in transfer amounts are constantly exposed to embezzlement either by an employee or third parties.
Business insurance
This is basic insurance that provides coverage for damages caused to the structure and contents of the business. In addition, the insurance provides coverage for third party claims arising from property damage caused to a third party through the company’s negligence. In addition, it is important to take care of employer liability coverage. The insurance provides coverage to the employer as a result of bodily harm caused to the company’s employee as a result of the employer’s negligence.
