Preferred Risk E&O Insurance is a professional liability insurance program designed especially for financial professionals with clean records. The Life Agents’ and RIA programs are Underwritten by CNA and Offered & Administered by Marsh U.S. Consumer. The P&C Agents’ program is Underwritten by Everest National Insurance Company and Offered & Administered by Marsh U.S. Consumer.

Qualified financial professionals pay 20% to 50% less than comparable E&O coverage for higher risk individuals. This represents a potential savings of hundreds of dollars for the typical insured.

You must be a member of the National Ethics Association (NEA) and be able to successfully complete the application for coverage.  There is an annual membership fee of $156 that is collected by Marsh U.S. Consumer and forwarded to NEA for your convenience. This annual fee covers your membership in the NEA which is required to participate in this group policy offering and is not part of the insurance transaction. You may also join NEA directly at www.ethics.net and then return and pay the insurance premium only by entering your NEA member number upon checkout.

It allows you to pay a premium commensurate with your E&O risk profile. Since applicants have passed stringent eligibility questions, the premium charged by CNA and Everest National Insurance Company is substantially lower than the premium charged for non-qualifying risks.

The Limits of Liability are:
Life Agents
$1M each claim/$2M individual insured annual aggregate
$15M total master policy aggregate for all insureds

P&C Agents
$1M each claim/$1M individual insured annual aggregate
$10M total master policy aggregate for all claims under all certificates of insurance

RIAs
$1M each claim/$1M individual insured annual aggregate  OR
$2M each claim/$2M individual insured annual aggregate  OR
$2M each claim/$3M individual insured annual aggregate
$15M total master policy aggregate for all insureds

The policies’ retentions are:
Life Agents
$500 each claim - Life, Accident and Health
$2,500 each claim - Disability Income, Fixed, or Indexed Annuities
$5,000 each claim – Mutual Funds and Variable Annuities

P&C Agents
$10,000 each claim

RIAs
$500 each claim – Life, Accident, Health, Long Term Care Products
$2,500 each claim – Fixed or Indexed Annuities, Disability Income
$5,000 each claim – Mutual Funds/Variable Annuities, All Other Securities, Investment Advisory Services, Fiduciary Advisor

Preferred Risk E&O Insurance provides protection against your liability for wrongful acts in the rendering of, or failure to render, professional services. This includes (but is not limited to) activities related to the sale, attempted sale, or servicing of property and casualty insurance, life insurance, accident and health insurance, managed health care organizations contracts, long-term care insurance, disability income insurance, fixed or indexed annuities, mutual funds, variable annuities, securities, and Medicare supplemental insurance.

* For non-members of the National Ethics Association (NEA), there is an annual membership fee of $156 that is collected by Marsh and forwarded to NEA for your convenience. This annual fee covers your membership in the NEA which is required to participate in this group policy offering and is not part of the insurance transaction. You may also join NEA directly at www.ethics.net and then return and pay the insurance premium only by entering your NEA member number upon checkout.

Activities relative to the sale, attempted sale or servicing of variable annuities or mutual funds, that are registered with the Securities Exchange Commission, if required, through a Broker/Dealer that is a member of the Financial Industry Regulatory Authority. Also activities relative to the sale, attempted sale or servicing of stocks and bonds by an Investment Adviser Representative.

No, they represent your total cost of coverage.

You may pay annually by credit or debit card.

The Life Agents’ program offers an additional option to pay monthly. The annual charge will be payable in 10 installments. The 1st installment will be 25% of your total premium and taken immediately. The remaining 9 installments will be divided equally and will be due on the coverage effective date for the next 9 months beginning with the second month (ie. If coverage is effective July 17th, the second installment will be due on August 17th). A $5 service fee will be added to each of the monthly payments. If two or more of my payments are rejected/declined, the monthly installment option will no longer be available and you will be required to pay the premium in full in order to keep your E&O insurance coverage in place.

Yes, the Errors and Omissions policy features unlimited extended reporting for no additional premium. In other words, you (or your heirs) can still file a claim for an event that occurred while you were covered under the Preferred Risk E&O Insurance program even if you retire, become disabled, change careers, or die. You must have been an insured in the Program for a minimum of six months and paid applicable premium to qualify. However, this coverage will cease if you secure replacement E&O coverage from another carrier. This coverage is not available if your coverage is cancelled for non-payment of premium.

Prior acts are dependent on your designation.

With respect to an agent or general agent, it is the date the agent or general agent became continuously insured without interruption under any claims made professional liability policy (subject to written proof of such coverage at the time the insured gives written notice to the insurer of a claim under the policy).

With respect to a Registered Representative or a Registered Investment Adviser, it is the latest date the Registered Representative or Registered Investment Adviser contracted with the Broker/Dealer.

Defense costs are included within the limit of liability.

Yes, it does cover those actions. For example, if your secretary makes an error servicing one of your clients and it results in an E&O claim, you would be covered. However, the policy does not cover the activities of other financial professionals with whom you work. If another licensed professional in your office makes an error with your client, you would not be covered.

Yes. Coverage is provided to a General Agent in the supervision, management and training of an insured agent. In other words, if someone who is employed by you commits an error or omission, in conjunction with activities covered under the policy, that results in a claim, you will be covered under this policy.

No. Administration of 401(k) and any other retirement plans are not covered activities under this E&O Insurance policy.

Yes, as long as the financial planning activities are in conjunction with the professional services you purchased, i.e. sale, attempted sale, or servicing of life insurance, accident and health insurance, managed health care organization contracts, disability income insurance (if coverage is purchased), indexed/fixed annuities (if coverage is purchased).

For a Registered Representative or Registered Investment Advisor, you are covered for financial planning activities in conjunction with the sale, attempted sale or servicing of variable annuities or mutual funds (if purchased) that are registered with the Securities and Exchange Commission (if required) through a Broker Dealer that is a member of the Financial Industry Regulatory Authority. Coverage is also available for the sale or servicing of stocks and bonds by a Registered Investment Advisor or an Investment Advisor Representative (if purchased).

This would not be covered under the P&C Agent program.

CNA and Everest met NEA's standards for product design and cost. In addition, the firm met our standards for financial strength and solvency.

Marsh U.S. Consumer, a service of Seabury & Smith, Inc., has extensive experience managing insurance programs for trade and professional associations. Marsh is part of the family of MMC companies. With 26,000 employees and annual revenues approaching $5 billion Marsh serves more clients than any other firm in the industry. Marsh works with businesses, public entities, organizations, and private clients in over 100 countries.

Please refer back to #13 for the prior acts definition for a Registered Investment Advisor.

Yes, those are synonymous terms.

The E&O Insurance policy provides coverage for your corporation or business entity with respect to the liability of your firm arising out of failing to render professional services. Please be aware that your RIA coverage only covers your work on behalf of the RIA firm. All licensed advisers/agents in your firm must purchase their own E&O coverage.

No, those are the only limits and deductibles available.

You need a Series 65 securities license.

No. The Errors and Omissions policy excludes coverage for activities relating to those products.

Yes, you are covered or "bound" the same day you submit the completed E&O Insurance application and pay for your policy provided the application does not indicate that you are ineligible.