Professional Liability Renewal Information and FAQs

Professional Liability Renewal Information and FAQs

As is customary this time of year, we have renewed our Professional Liability and Cyber Security insurance policies (E&O policy), and this information is intended to provide each of you with an update surrounding this annual occurrence. While it seems like all prices are going up, given the quality of our representative population, strong compliance program and low claims history we’ve been able to increase the levels of coverage without having to incur premium increases for the renewal period starting July 1, 2024, through June 30, 2025. We consider this a significant win – particularly in light of an industry that is undergoing significant regulatory changes.

As a reminder, our coverages and fees apply to all those registered with Mutual Securities, Inc. and are an annual financial commitment (Jan – Dec) – meaning that those choosing to resign mid-year are subject to the balance of the premium for the remainder of the calendar year. Continue reading for frequently asked questions and more information on Professional Liability Renewals at Mutual.

Changes will go into effect on September 1st, 2024.

Professional Liability Renewal FAQs:
Q: Who is the Insurance Provider?
A: Lloyd's America, Inc. 

Q: Where do I find Mutual's insurance binder?
A: The insurance binder can be found on the Power Portal, here.  

Q: What is Mutual’s coverage?
A: Our coverage is $2M annual aggregate limit.
 
Q: What is Mutual’s deductible?
A: Mutual’s deductible is $150,000 per claim
 
Q: Am I covered by the Cybersecurity Insurance?
A: Any registered persons with Mutual are covered by the cybersecurity insurance policy.
 
Q: Is insurance activity still covered under the current policy?
A: Insurance activity is covered if it is for a Mutual Securities' client.  Any insurance sold solely under your approved outside business activity as an insurance agent is not cover by this policy.

Q: When did Mutual stop covering our RIA business? When was this communicated to us?
A: There was a communication sent directly to any dually registered representatives in July 2023 about some of our pricing increases and changes last year that referenced the fact that we aligned our policy with the new requirements that the RIA custodians now required that RIAs maintain their own E&O policy. Because of this new requirement by the custodians you work with, such as Fidelity and Schwab, it did not make sense for us to continue to carry that coverage in our policy. July 2023 - Hybrid Price Increase
 
Q: Who should I talk to about E&O for my RIA?
A: We have partnered with AiK2, who has extensive experience working with RIAs on their insurance needs. Here is a link to their website: Advisor Insurance (aik2.com)
 
Q: If you no longer cover our RIA business, why is there still an additional charge for Professional Liability Coverage for people registered with an unaffiliated RIA?
A: This charge is for the greater cost of oversight and liability that Mutual incurs for insuring a registered person that is dually registered with an unaffiliated RIA.
 
Q: Is Mutual willing to waive the additional charge if we have our own E&O policy?
A: Mutual is only willing to waive the additional charge if your E&O policy names Mutual Securities, Inc. as an additional insured and the coverage limits are equal to or greater than our policy coverage. Evidence of this would have to be provided before the charges could be waived.

Q: Who should I talk to about questions on this E&O policy that aren't covered in these FAQs?
A: Please contact MSI Compliance at 805-764-6740, x804 or by submitting a case through power portal for questions on Mutual’s E&O policy and coverages, and/or to file an E&O claim.

Click here for more detailed information.

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