The obvious follow on post to When is D&O Enough?, is of course, when is Professional Liability enough. Now the decision points start to get murky for FinTech and other AltFi companies. Professional Liability in it's simplest form is insurance for the performance of a service to a third party for a fee. All three components need to be there: (1) service; (2) third party; (3) fee. Professional Liability can be written for a very wide range of service companies from Lawyers and Accountants to Technology Consultants and Marketing Specialists. In fact, the beauty of the Miscellaneous Professional Liability product is that we can craft the definition of Professional Service to match the exposure of the organization.
When a company is operating an investment portal or crowdfunding platform, we have to stop and think about what the Professional Service actually is and what is the fee basis or revenue source of the company. It is from these questions that we determine the appropriate path to develop the right Professional Liability product.
Does your company provide a service for a fee? Perhaps you need Professional Liability coverage also. Contact us today to talk about your exposures and how to craft a product that addresses your needs.
Monica M. Minkel, RPLU, MLIS, cyRM has been working exclusively with Directors & Officers Liability, Professional Liability, Cyber Liability and related products for more than 15 years. She started her interest in finance by loaning money to her mom at age 11 (complete with a loan agreement and competitive interest rate). She is passionate about all things in the financial industry and the way technology is changing the way capital markets function.