Broad Form Company Liability

Broad Form Company Liability covers the financial institution for all of the Professional Services it offers including, but not limited to, depositor liability, lender liability, securities liability, and insurance and brokerage services liability. It also covers suits brought by parties other than customers (third party liability).
 

Sample Endorsement
Coverage Summary

Claims Examples
  • A depositor’s investment advisor embezzles hundreds of thousands of dollars after a bank officer wrongfully permits a signature card to be removed from the bank. The depositor sues the bank and its officers.
  • An investor advances money to a local company in reliance on a bank’s representations that the company is financially sound, but experiencing a short term cash crunch. When the company defaults, the investor sues the bank.
  • Elderly victims sue a bank for aiding and abetting a tort when an unscrupulous broker in another state perpetrates a Ponzi scheme using the bank’s CDs as the alleged investment.
  • Shareholders of a bank sue another bank for terminating merger discussions after months of negotiations.
Features
  • Available as an endorsement to the D&O Policy.
  • Depositor liability claims can result from a bank honoring instruments with improper endorsements, erroneous asset transfers, and general account errors. 
  • Lender liability coverage provides protection from suits brought by borrowers, guarantors and non-customer third parties. 
  • Securities liability coverage protects the bank from individual shareholder lawsuits, class action litigation and regulatory actions.
  • Third party liability coverage protects the institution from third party lawsuits stemming not only from customer relationships, but also from non-customer relationships such as other banks, vendors, business partners, etc.
 

Notwithstanding any language to the contrary, nothing contained herein constitutes nor is intended to constitute an offer, inducement, promise, or contract of any kind. All coverage descriptions and claims examples are provided for informational and educational purposes only and are not a representation as to coverage for any particular claim and are not represented to be error free. Coverage for any claim is determined upon the specific facts of the claim, the terms and conditions of the policy and applicable law. For details on the coverage provided by your specific contract of insurance, please refer to your policy. Coverage is subject to underwriting guidelines and may not be available in all states. Limits may be capped for underwriting reasons. Any links to any sites which are not originated by ABA Insurance Services Inc. (ABAIS) are provided only as a courtesy and are not intended to nor do they constitute an endorsement by ABAIS of the linked materials.