As the impact of the current economy has taken its toll on corporate credit unions, CUNA Mutual has had to adapt its bond program accordingly.
“While we cannot comment on individual account actions, our underwriting process considers the unique characteristics and exposures of each customer,” said CUNA Mutual Senior Manager of Media Relations Rick Uhlmann. “Because financial condition has an impact on bond and SIP losses, we have an obligation as a mutual company committed to credit unions to take certain actions and maintain our financial strength for all of our policy owners.”
At issue is the greater risk exposure on the bond and special insurance package coverage corporate credit unions present resulting in increased expenses for the program. SIP can include coverages such as directors and officers and employment practices liability. There is increased risk of a suit against officers and boards of any corporate, particularly those who have or will conduct write-downs of capital, raise additional capital or reduce staff. As a result, some of the changes will include premium, coverage limits and deductibles. CUNA Mutual will also use a more intensive underwriting process.
A few of the more significant changes that can be expected in general range from increased bond and SIP premiums, reduced directors, officers and volunteer liability limits, and removal of limits on faithful performance to no longer providing corporate credit union network excess electronic crime policies.
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