If you work in the financial industry, you are probably aware of the great risks that deal with theft, fraud, cybercrime, employee dishonesty, and compliance with government regulations. No doubt you carry a banker’s professional liability insurance policy to help defray the costs associated with claims in these areas, but all too often it takes an experience of loss to understand how the policy works. Here are two common claims brought against banking professionals.
A borrower is told by the loan officer that the loan request will be funded. The borrower makes business plans and purchases according to the verbal guarantee, yet subsequently, the loan is denied. The borrower files suit against the loan officer and company for damages and lost business opportunities.
Professional Services Liability
A bank employee transposes numbers on the ACH transactions for a merchant account, causes funds to deposited to the wrong account. The business receiving the funds withdraws them and refuses to return them when the bank notices the error. The client that did not receive the deposit sues the bank for the loss.
In order to protect your company from losses related to these situations and others, the information found at https://www.fgib.com advises that a strong professional liability policy be taken out for the institution. The financial costs of legal action can be damaging to your company, as well as the resulting loss of business from client mistrust.