NFCA Insurance Program
Agents' Errors & Omissions
Directors & Officers

Be sure to consider the NFCA program when reviewing your society’s risk management strategy.  Calsurance (a division of Brown & Brown, Inc.)* is working hard for member societies by offering improved customer service and enhanced product offerings.  A quick and thorough way to learn the details is by replaying the complimentary webinar “Debunking Six Myths of the NFCA Insurance Program.”  Click here for more information and to replay this informative web event.

For program details, please contact Michele K. Gerace, Esq. - CalSurance Associates; Ph: (201) 526-4628; Email: mgerace@calsurance.com.

Agents’ Errors & Omissions Program

Insurance Carrier:  

Zurich American Insurance Company

Limits of Liability:   

$1,000,000    Each Claim

$1,000,000    Aggregate each Agent

- OR -

$2,000,000    Each Claim

$2,000,000    Aggregate each Agent

Deductible:               

$500             Each Claim involving products (Damages Only) of 
                   sponsoring society

$1,000          Each Claim involving outside products

Participation/Eligibility:

n       Independent or captive agents (FT or PT)

n       Competitive rates

n       Mandatory or voluntary participation

n       No cost to sponsoring society

n       Premium collection options

What does this policy insure?

Generally, the E&O policy provides protection for defense costs and damages arising from claims made against an Agent for any negligent act, error or omission in the performance of Professional Services. 

Who is covered under the Policy?

n       Agents

n       Any corporation, partnership or other business entity which engages in Professional Services and is either owned or controlled by the Agent

n       Any unlicensed employee or licensed administrative assistant employed by and acting on behalf of the Agent

n       The Sponsoring Society – for vicarious liability

What professional services are covered?

The sale and/or servicing of:

n       Life insurance, accident and health, fixed annuities and disability income insurance

n       Variable insurance and annuities

n       Employee Benefit Plans

n       Mutual funds and securities (available for additional premium charge)

Management Liability Program

Common Claim Allegations

n       Mismanagement of operations or organization assets

n       Self-dealing and conflicts of interest

n       Acts beyond authority granted in by-laws

n       Violation of state and federal laws

n       Breach of fiduciary duties

n       Employment Practices

Management Liability Insurance

n       Directors, Officers and Organization

n       Employment Practices Liability

n       Fiduciary Liability

n       Outside Directorship Liability

n       Fidelity & Crime Insurance

Who is covered?

n       The Insured Organization

n       Subsidiaries of the Parent Company (more than 50% ownership)

n       Past, present and future Executives and   Employees (does not include independent contractors)

n       Spousal and domestic partner

n       Can include in-house counsel and members of advisory committees 

Definition of Claim

n       Written demand for money or non-monetary relief

n       Civil and criminal proceedings

n       Administrative or regulatory proceedings

n       Written requests to toll or waive statute of limitations

n       Employment practices (most common claim for non-profit organizations)

Covered Wrongful Acts

n       Wrongful Act

q      error, misstatement, misleading statement, act, omission, neglect, breach of duty

q      against an Insured Person, must be acting in their capacity as such

What will the policy pay?

n       Judgments, settlements, and defense costs

q      Front pay, back pay (EPL)

n       Damages

q      Punitive damages

q      Exemplary damages

q      Multiplied damages

n       Excise Benefit Tax (fiduciary liability coverage)

Outside Directorship Liability

n       Generally limited to not-for profit boards at request or consent of society

n       Not-for profit usually limited to 501(c)3