Iowa Bankers Association Iowa Bankers Mortgage Corporation
Iowa Bankers Insurance
and Services
8800 NW 62nd Avenue
PO Box 6210
Johnston, IA 50131
Toll-Free: 800-532-1423
Fax: 515-286-4214

IBBP Customer Service:
    800-258-1415
125 Claim Fax:
    515-286-4244
IBBP Billing Fax:
    515-286-4369

Agent Customer Service:
    800-775-8858

Directors & Officers

Directors & Officers

Management Liability

Our management liability coverage protects executives for certain risks as they manage the bank, with an option to extend coverage to the bank itself.

Selling the bank
Your board of directors has entered into an agreement to sell the bank. A group of shareholders is unhappy with teh decision and brings action against teh board, alleging that the directors breached their fiduciary duties by not making enough of an effort to determine if the selling price was adequate.

Minority shareholders filing suit
Minority shareholders, who are not directors or officers, believe their interests are not being respresented and bring an action on behalf of the bank, alleging the directors and officers have breached their fiduciary duty to the minority shareholders and committed acts of mismanagement.

Investors filling suit
Your bank raises capital through an offering fo equity securities. After the offering, the bank's financial condition and performance decline, lowering its value and, thereby, the value of its securities. The investors bring an action against your bank, as well as your directors and officers, alleging negligent misrepresentation of your bank's business prospects, earnings, expansion plans and future business prospects.

Selling a subsidiary
You sell one of your subsidiaries to another bank. A few months later, the other bank brings suit against your bank and its directors and officers, alleging misrepresentation of the financial condition of the subsidiary.


Bankers Professional Liabiltiy

Our bankers professional liability coverage protects your bank and its directors, officers and employees for certain liabilities resulting from errors and omissions in the performance of professional services.

Wire transfer services
Your bank is sued for wiring funds it allegedly has agreed to hold in the account. The amount wired is 9.5 million. The circumstances leading to the error are complex, but your bank faces an exposure to the entire amount that was wired.

Garnishment notices
Your bank honored a defective garnishment notice and is liable for this error. 
 

Lender Liabiltiy

Our bankers professional liability coverage, with lender liability protection, covers the bank, its directors, officers and employees for certain risks associated with its lending acts.

Error in construction loan
Your bank errs in its handling of a construction loan when it pays out sums directly to a general contractor after already charging the customer to have a title company handle the disbursements. The general contractor disappears with the funds without paying the subcontractors. As a result, the home builder is left without key materials to build the home. Your bank is sued by the homeowner and settles, paying the subcontractors the money that was taken by the general contractor.

Failure to obtain lien waivers
Your bank errs in handling disbursements to a general contractor for an addition to a local church. Your bank also fails to obtain lien waivers from the subcontractors after giving the money to the general contractor. The general contactor disappears with the money and the subcontractors move to enforce their liens. Your bank negotiates settlements with the subcontractors.


Employment Practices

Our employment practices liability coverage protects your bank and its directors and officers against certain claims for a wide range of employment practices, including any actual or alleged violations of any federal, state, provincial or local statutory law, common law or civil law anywhere in the world, prohibiting discrimination of any kind. Protection is also available for certain claims of harassment, wrongful discharge or termination, and negligent hiring or supervision of others.

Racial discrimination
Your bank’s head teller was fired because of performance issues but files a notice of charges with the Equal Employment Opportunity Commission for racial discrimination. The EEOC commences an investigation to determine probable cause. If the EEOC finds probable cause, and if a lawsuit is filed, your bank faces substantial costs to defend the claim, plus damages if the suit is successful.

Disability discrimination
A former executive vice president of your bank files a claim under the Americans with Disabilities Act. Defense costs range in the mid-five figures and the claim hasn’t even reached the motion stage yet. Your bank could easily be looking at mid-six figures in damages and fees.

Sex and age discrimination, retaliation
A 43-year-old female loan officer of your bank brings suit against your bank alleging that, despite excellent job evaluations, the bank negligently failed to promote her for 17 years. She further contends that the bank retaliated against her after she filed a complaint with the human resources department and that she has suffered emotional distress and sexual discrimination.

Age discrimination
An employee alleges that he was repeatedly denied promotions while younger employees outside his department were promoted. The employee points to a memorandum by the bank’s president, geared toward identifying, hiring and developing “the next generation” for future management positions.

Pregnancy discrimination
A female employee alleges wrongful termination, pregnancy discrimination, and internal infliction or emotional distress in violation of Title VII of the Civil Rights Act, Americans with Disabilities Act, and state statutes. She alleges that, despite excellent performance evaluations, she was terminated after being absent from work for three days over the course of one month due to pregnancy complications. In addition to the costs for your own defense, your bank faces potential liability for lost wages and the plaintiff’s attorney fees.
 

Trust Liability

Our trust liability protection provides coverage to the bank, its directors, officers and employees for a wide range of trust acts. This includes coverage for a trustee of any IRA or Keogh Account.

Beneficiaries filing suit
Your bank is a trustee of two trusts funded by an estate. When the owner of the estate dies, your bank acts in its capacity as a trustee by assigning values to the property and dividing that assets between the two trusts – one for the deceased individuals surviving spouse and another for his children from a previous marriage. The beneficiaries sue each other, claiming that the valuation method used by your bank benefits one trust at the expense of the other. Your bank is dragged into the lawsuit on an allegation of a breach of a fiduciary duty pursuant to the trust terms. The amount of the loss is many millions and your bank is potentially exposed for the entire amount, plus substantial attorney fees.

Mismanagement of a trust
Your bank administers a trust for a living trustor. The trustor borrows money against the trust, which ultimately creates a loss. After the trustor dies, the beneficiaries of the trust sue your bank, asserting your bank breached its fiduciary duty by allowing the loan, which led to the loss. Defense costs are substantial and there is exposure for the damages.
 

 

Fiduciary Liability

Our fiduciary liability coverage protects the bank and the bank’s employee benefit plan, as well as trustees, directors and officers, from certain claims related to management of the banks employee benefit plans. Coverage can be extended to Employees Stock Ownership Plans and employees. Protection is also available for certain claims for a breach of fiduciary duty, a denial of benefit under a plan or an ERISA Section 510 violation.

Profit sharing and savings plan
Your bank sponsors and profit sharing and savings plan. The value of the plan assets deteriorates to the extent that benefits are adversely affected. Plan participants bring suit, alleging that the plan wrongfully invested plan funds in high-risk investments in violation of the terms of the plan.

401(k) plans
You bank establishes a 401(k) plan that has a limited number of investment options. Plan participants allege that the plan’s investment options are underperforming and that your bank breached its fiduciary duty because it did not offer investment options with higher returns.

Employee Stock Ownership Plans (ESOP)
Your bank establishes an Employee Stock Ownership Plan (ESOP) that purchases stock from the bank’s founder at a value of 75million. One year later, the value of the assets in the ESOP drops to 10 million. The plan participants sue the trustees of the ESOP, alleging their negligent actions caused the ESOP to pay inflated price for the shares that were sold to the ESOP.

Wrongful denial of disability benefits
A former employee sues your bank and the plan administrator under ERISA, seeking review of a denial of long- and short-term disability benefits stemming from a disability.

Preexisting medical conditions
An employee of your bank is diagnosed with a medical condition. Two weeks later, the employee becomes eligible for health insurance. Since the plan excludes coverage for preexisting conditions, the employees claim is denied. The employee sues the plan and its trustees for improper denial of benefits. Note: Coverage in this instance would only apply to defense costs incurred when the matter is taken to court.

Workforce reduction effort
Your bank undergoes a restructuring, which results in workforce reduction. Some of the employees that are laid off sue under Section 510 of ERISA claiming they were terminated solely to prevent them from obtaining pension benefits. Your bank prevails, but incurs substantial defense costs.

Subcontracting to cut benefit costs
Your bank decides to obtain a competitive bid for work currently performed by a subsidiary. As a result, a lower bidder replaces the subsidiary. The successful bidder offers continued employment to the employees of the subsidiary but provides fewer pension and welfare benefits. The affected employees sue under Section 510 of ERISA, seeking full restoration of their previous benefits.

 

Companies IBIS markets

Chubb Group of Insurance Companies
Rated “A++“ by A.M. Best as of 1/10

FinSecure
Rated "A+" by A.M. Best as of 1/10

OneBeacon Insurance Group
Rated “A“ by A.M. Best as of 1/10

Progressive
Rated “A+“ by A.M. Best as of 1/10

Travelers
Rated “A+“ by A.M. Best as of 1/10

Zurich
Rated “A+“ by A.M. Best as of 1/10


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Mid America Banking Insurance Services, Inc., a subsidiary of IBIS, provides insurance programs to banks outside of Iowa. 

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Iowa Bankers Mortgage Corp. (IBMC) offers the products & experience Iowa banks need in the secondary mortgage market.

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The Iowa Bankers Association (IBA) is dedicated to serving Iowa banks and their employees.

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