Security Officer's insurance

Question:

I'm not a bank officer but I've been told that the bank's Directors & Officer's (D&O) Liability Policy will cover me as the designated Security Officer. Is this true?

Answer:

Probably not. Your bank's D&O policy will address issues that arise out of your role as the designated Security Officer -- providing that you're actually a fiduciary officer of the corporation. You can take advantage of this insurance if you are promoted to at least an AVP -- or if the bank adds you on a "rider". And this may not be all that you need . . .

Errors & Omissions (E&O) insurance addresses issues that may involve "good faith" mistakes in this role. Your bank should also provide you with this insurance.

Professional Liability (PL) insurance addresses issues that may result from claims regarding any acts of professional misconduct involving "willful misconduct" or "gross negligence". Your bank should also provide you with this insurance.

First published on BankersOnline.com 11/14/11