FGIB:Offering Insurance for Civil Money Penalties for Directors & Officers
A financial institution’s Directors & Officers (D&O) insurance policy cannot provide coverage to individuals for civil money penalties imposed for alleged wrongdoing. The FDIC coupled with increased regulatory scrutiny has made it explicitly clear that a bank can’t insure or indemnify any civil money penalties on its D&O policy, leaving every bank director and officer exposed. To respond to this exposure, which can significantly impact the assets of an individual director or officer, Financial Guaranty Insurance Brokers (FGIB) has partnered with an insurance carrier to provide a new separate insurance policy, Civil Money Penalties Personal Protection (CMP) Coverage.
Civil Money Penalties coverage will pay up to $250,000 per director or officer should they be assessed a penalty personally as a result of a regulatory investigation.