Financial Lines Insurance
Zurich is committed to providing a full suite of Financial Lines products to the Australian market, offering a broad scope of cover that brokers may confidently offer to their clients with the backing of Zurich’s strong balance sheet.
Our highly experienced Financial Lines underwriting team, consisting of over 20 specialists in Australia, is committed to providing a consistent, professional approach to Financial Lines underwriting. A small specialised team will look after your needs in terms of Financial Institutions, with market leading underwriters providing tailored programs.
You and your clients benefit from our superior in-house Financial Lines claims team. All Financial Lines claims are managed in-house, thus guaranteeing our customers’ interests come first in the event of a claim. Our Financial Lines claims team, many of whom are qualified lawyers, has an extremely high level of expertise in managing Financial Lines claims. These specialists are experienced at dealing with frequency claims, through to negotiating effective settlements and managing the defence of significant claims involving multiple parties. All of our insureds are assigned a single point of contact for the life of their claim.
Zurich’s International Programs proposition addresses cross-border risk in more than 170 countries, providing Financial Lines insurance solutions for companies with global exposures where non admitted insurance is not permitted. This approach ensures compliance with overseas licensing laws and premium tax requirements in jurisdictions where non admitted insurance is not permitted.
You and your clients get valuable insights from our Financial Lines global site.
Find articles, blogs, interviews, quarterly D&O country updates and other materials on pertinent financial lines topics.
For more information contact:
Head Financial Lines & Liability
Financial Lines Claims Manager
Provides important coverage that organisations need in today's challenging business environment.
Employment Practices Liability Insurance
Protects both a company and its employees when they become legally liable to pay claims made by employees
Professional Indemnity protects a business and its employees when they are sued for an act, error or omission in relation to the provision of professional services. Also includes solutions for IT Professional Liability, SME Professional Indemnity and Architects & Engineers Professional Indemnity.
Includes solutions for investment managers as well as cover for financial institution's fraud and professional liability exposures.
SME Professional Indemnity
All businesses, regardless of their size, should be afforded the protection of professional indemnity insurance.
Commercial Crime Insurance
Globalisation and developments in technology ensure businesses are more than ever faced with increased exposure to commercial crime.
Type: pdf (299Kb)
We tailor insurance programs to our customers in any combination of bankers’ blanket bond, computer crime, directors and officers and professional indemnity insurance.
Type: pdf (564Kb)
Zurich now offers a standalone Professional Liability Insurance policy for Financial Institutions. This Quick Reference Guide provides a snapshot of the differences between this wording and the professional liability cover provided by Zurich’s Fraud and Professional Liability Insurance – Financial Institutions policy.
Type: pdf (561Kb)
Zurich now offers a standalone Fraud Insurance policy for Financial Institutions. This Quick Reference Guide provides a snapshot of the differences between this wording and the fraud cover provided by Zurich’s Fraud and Professional Liability Insurance – Financial Institutions policy.
Type: pdf (783Kb)
Effective date: 1 December 2012
Type: pdf (400Kb)
Zurich has a variety of Professional Indemnity (PI) policies, each tailored to give comprehensive cover for a specific sectors both in Australia and globally.
Type: pdf (687Kb)
Bringing you protection and peace of mind
Zurich launches its response to the NZ Bridgecorp Decision
Designed to address concerns raised by the recent Bridgecorp decision, Zurich has developed the Companion Directors and Officers Defence Costs and Expenses Insurance policy for the New Zealand and Australian insurance market.
As an accompaniment to the traditional Zurich Directors and Officers (D&O) Liability Insurance policy, the Companion policy provides comfort that a dedicated limit of liability for defence costs and other expenses will be available when a statutory charge prevents payment under the traditional policy.
What is the Bridgecorp Decision?
The September 2011 NZ High Court ruling in the Bridgecorp case prevented directors from accessing their Directors and Officers Liability Insurance policy to fund their defence to criminal and civil proceedings brought by the NZ Securities Commission, despite the policy terms expressly including this cover within the policy terms and conditions.
The decision was based on the operation of section 9 of the NZ Law Reform Act 1936 which recognises a statutory charge in favour of potential third party claimants, to whom a liability might be owed (in this case, the receivers and liquidators), can take precedence over advance payment of the insurance monies, overriding the contractual agreement between the insurer and the insureds.
As a result of the decision, any advancement or payment of defence costs by a D&O insurer could be deemed to be made as a “volunteer” payment, above and beyond the policy limits of liability.
With equivalent legislative provisions existing in New South Wales, The Australian Capital Territory and the Northern Territory, uncertainty created by the Bridgecorp decision extends to both New Zealand and Australian directors and officers.
Why is the Bridgecorp Decision concerning?
The Bridgecorp decision has been the subject of much discussion:
- Previously section 9 of the NZ Law Reform Act has not been applied to Directors and Officers Liability Insurance, with the genesis of the section being in relation to automobile and personal injury insurance;
- The potential claimants (Bridgecorp’s receivers and liquidators) had not yet made a claim against the directors, however their charge against the D&O policy limits prevailed;
- The decision contravened the express policy language which provided for the advancement of defence costs to the insured directors;
- The decision converted the D&O policy to one that benefitted potential claimants, rather than the purpose of its purchase – to benefit the insureds.
How might the outcome have been different?
The ruling in the Bridgecorp case noted that a different outcome may have eventuated in the following circumstances:
- If the policy’s aggregate limit of liability did not extend to include the defence costs;
- If the limit of liability was deemed to be adequate to respond to the quantum cited in the statutory charge, as well as the amounts required with respect to the NZ Securities Commission proceedings.
What is the Zurich response?
The Zurich Companion policy offers dedicated defence costs and expenses cover for directors and officers, responding when the traditional D&O policy is precluded from advancing or paying costs and expenses by reason of a statutory charge under the Australian or New Zealand legislation or any other substantially similar legislation.
The Zurich Companion policy is only available as an accompanying policy to a Zurich D&O policy. As the Companion policy is a separate and unique cover there is an additional cost to the customer when purchasing this policy.
Highlights of the Zurich Companion policy
- Zurich’s Companion Directors and Officers Defence Costs and Expenses policy sits independent of the traditional Zurich D&O policy, providing accompanying cover for:
– Insured Persons (“Side A” cover); and
– Company Reimbursement (“Side B” cover).
- The Zurich Companion offers non-aggregating capacity with Zurich’s traditional D&O policy, up to $10 million (equal to or less than the traditional Zurich D&O policy limit).
- Deductible levels bridge the Companion D&O Defence Costs and Expenses policy and the traditional Zurich D&O policy, ensuring the Insured is not penalised with the burden of double deductibles. This feature is embedded within the Zurich Companion policy conditions for clarity of our underwriting intent.
- In addition to providing defence costs, the Zurich Companion policy includes the following expenses:
– investigation costs
– extradition costs
– prosecution costs
– civil or bail bond expenses
– deprivation of assets expenses
– public relations expenses.
How does the Zurich Companion policy link to the Zurich traditional policy?
- The Zurich Companion policy includes a Connectivity Condition providing linkage to the Zurich traditional policy.
- When the Zurich Companion policy is purchased, a Connection Endorsement is added to the Zurich traditional D&O policy to note this accompanying policy.
What are the mechanics of a D&O claim payment under the Zurich response?
- If an enforceable statutory charge applies to the traditional Zurich D&O policy, the Zurich Companion policy will respond in the first instance, providing advancement of defence costs in accordance with policy terms and conditions.
- Where defence costs or expenses have been advanced or paid under the Zurich Companion policy and subsequently it is determined that no statutory charge applies to the traditional Zurich D&O policy (or that the traditional D&O policy limit of liability was sufficient) the amount of such payment will be reimbursed from the traditional Zurich D&O policy to the Zurich Companion policy. The reimbursement feature is necessary in order to retain the viability of the Zurich Companion policy for the duration of the policy period.
- Where no statutory charge applies to the traditional Zurich D&O policy during the policy period, the D&O claims will be contemplated under the traditional Zurich D&O policy terms and conditions.
Zurich Companion D&O policy – Conversion to Excess Side A Defence Costs
- In the event that no statutory charge applies and the Zurich traditional D&O policy limit of liability is fully exhausted due to claims payments, the following applies:
– The Zurich Companion D&O policy converts to provide follow form Excess Side A Defence
– The converted Excess Side A Defence Costs cover attaches at the top of a layered D&O program;
– There is no additional premium charge for this conversion feature – it is automatically included
within the premium required for the Zurich Companion D&O policy.
- By including the conversion feature as part of the Zurich Companion D&O policy, Zurich recognises that the Bridgecorp decision has created difficulty for insureds, resulting in additional insurance premiums. It is Zurich’s intention to optimise the possibility that the additional Zurich Companion capacity will be used by the insured.
What other Zurich Companion policies have been developed?
Zurich has developed Companion policies for the following range of Financial Lines insurance products:
- Directors and Officers (AU & NZ)
- Prospectus Liability Insurance “POSI” (AU & NZ)
- Management Liability Section 1 Insured Persons only (AU only)
- Investment Structure “ISIS” and Investment Structure Venture Capital (AU & NZ)
- Zurich Aged Care Directors & Officers (AU only)
As not all of the features are available across all of the Companion products, please contact your local Zurich representative to discuss these variations.