What Can Personal Penalty Insurance Do for You?

What Can Personal Penalty Insurance Do for You?

civil monetary penalty insurance

If you’re a director or officer at a financial institution, you have a lot on your plate. As someone in a leadership position, you’re responsible for making important enterprise decisions and steering the company in a positive direction. Unfortunately, if allegations of regulatory wrongdoing arise, you can be on the line for certain assessed penalties. In this case, civil monetary penalty insurance can help you recover.

Financial regulatory agencies have the power to levy monetary penalties against financial institutions for alleged wrongdoing following an investigation. They also have the ability to fine individuals in high-ranking, decision-making positions within the financial institution if the investigation determines that said individuals knowingly directed or purposefully ignored the activity that violated regulations. This means you can be personally on the hook for a substantial amount of money.

But wait, you might be saying. What about the insurance the financial institution has to specifically cover officers and directors? Regrettably, companies are restricted from including coverage for these specific kinds of penalties. The penalty amounts must be settled by the individual.

The good news is that there is civil monetary penalty insurance available directly to individuals in leadership positions. Directors and officers can obtain their own coverage and thereby protect their personal assets. You can find your own security against losses from personal penalties with the right insurance coverage.