1. What professional services are covered under this policy?
As a Licensed Life Insurance Agent or Registered Representative, you are covered for:
As a Registered Representative under contract with Park Avenue Securities or as a Registered Investment Advisor, you are covered for:
2. Does this coverage apply to acts committed prior to the effective date of the policy?
Coverage is on a "Claims Made and Reported" basis, which covers claims made against you and reported to the carrier during the policy period. Full "prior acts" coverage is provided as long as:
3. Is my partnership or corporation covered?
Yes, Coverage is provided for any corporation and partnership or other business entity in the business of insurance services, which is either owned or controlled by you, the Named Insured, or in which you are an employee, but only with respect to those operations of the business entity related to the professional services covered herein and provided by you.
4. Is my support staff covered under this policy?
Employees of insured agents, including leased employees, are covered solely while acting within the scope of his/her duties as such and provided such person is not at the time of the alleged Wrongful Act a party to an agent, general agent, insurance broker or registered representative contract with any corporation, partnership, or other business entity engaging in professional services.
5. What do the limits $3,000,000/$3,000,000 mean?
The first limit stated is per Wrongful Act and the second limit is the total agent aggregate per year. For example, with respect to one agent, the policy will not pay more than $2,000,000 on any one claim and will not pay more than a total of $2,000,000 for the entire year for each agent, regardless of the number of claims. The per Wrongful Act limit is the limit of the insurer's liability for all damages and claim expenses arising out of the same or related professional services without regard to the number of insured, claims, demands or claimants. The inclusion of more than one insured or the making of claims by more than one person shall not increase the Insurer's Limit of Liability.
6. What is the retention and how is it applied?
A $500 retention will apply toward payment of defense costs and damages with respect to Guardian Life or Guardian Life’s subsidiary sponsored products and/or services. A $5,000 retention will apply toward payment of damages and defense costs on outside products, securities approved by and sold through Park Avenue Securities and insurance products issued by other insurance companies. For purposes of the retention, continuous, repeated or interrelated Wrongful Acts shall be considered one Wrongful Act.
7. Would I be covered for the sale of life, health and accident products of insurance companies I may do business with other than Guardian Life?
Yes, as long as your agency contract is in effect with Guardian Life and as long as such companies are licensed as authorized insurance carriers.
8. Does the policy provide coverage for Life Settlement transactions?
For purposes of this coverage, “Life Settlements” means the sale of a term, variable, universal or whole life insurance policy by the policy holder or owner for valid consideration, prior to his or her death to a third party for payment of all or a portion of the policy’s death benefit, subject to the third party’s assumption of all rights, obligations, including but not limited to premiums, under said policy.
Coverage is provided for Life Settlement transactions as long as the agent:
With respect to Life Settlement transactions, coverage would not apply involving a life insurance policy that was sold by an agent/rep to the policyholder within two years of the Life Settlement transaction date.
Coverage would also not apply to claims alleging or arising out of, based upon or attributable to the agent’s actual or alleged guarantees, promises, or warranties as to interest rates, market values, earnings, future values or future premiums or payments in connection with Life Settlements.
9. Is there coverage for giving generic investment advice on securities in general when developing a financial plan for a client?
Yes, there is coverage for generic investment advice whether or not a product is actually sold.
10. Is there coverage for fee based Financial Planning, including asset allocation and portfolio management services?
Yes, you are covered for Investment Advisory Services as a Registered Investment Advisor with respect to securities approved by Park Avenue Securities, provided that you give written notice of such services to Park Avenue Securities and receive written approval to conduct such services from Park Avenue Securities.
11. This policy is a 'Duty to Defend' policy. What does that mean?
The Insurer has the duty to defend you provided there is an allegation made against you that would be covered by this policy. That duty to defend exists even if the allegation may be groundless, false or fraudulent.
12. May I report claims after my agent or registered representative contract is terminated?
Yes. There is an automatic one-year Extended Reporting Period (tail coverage) for all products for an agent of Guardian Life and/or a registered representative of Park Avenue Securities. This tail coverage is offered without any additional cost to you. This will provide coverage for claims first made against you and reported to the insurance carrier during the Extended Reporting Period arising out of alleged negligent acts, errors or omissions which took place prior to your agency contract termination and which are otherwise covered by the policy. If you secure E&O coverage under another Agent’s E&O Program this policy will be excess.
13. Do I have coverage for expenses arising from a regulatory investigation?
Yes, you would have coverage for regulatory investigation expenses as long as the investigation arose as a result of a customer complaint and the activity is otherwise covered by this policy. Coverage is provided on a sublimited basis, see the policy for additional details.
14. What happens to my coverage in the event of retirement, disability or death?
Upon retirement, death or disability of an Insured Agent/Rep during the Policy Period, the retired, deceased (or the estate of the deceased insured Agent/Rep on his/her behalf)or disabled Insured Agent/Rep shall have an unlimited Retired/Disabled/Deceased Agent Discovery Period, effective as of his retirement, death or disability to report claims under the policy but only for Wrongful Acts which occurred prior to the date of his/her retirement, death or disability. Retirement means a full withdrawal from the securities industry, you may retain your license if needed to collect trailing commissions but may not continue to transact securities or insurance business. There is no coverage for any services rendered upon termination of your contract with Guardian. For the purposes of this coverage, a Retired Agent contract does not qualify as retirement under the policy.
15. Am I covered for “Selling way”?
No. There is no coverage for a Registered Representative conducting unauthorized business activity.
16. Is there coverage for giving investment advice on a specific security?
Yes, if the advice pertains to a security that is approved by Park Avenue Securities. However, there is no coverage for claims arising from the guarantee as to an investment's future value or a fluctuation in a security's market value.
17. Am I covered for my activities in the sale and/or servicing of employee benefit plans?
Yes, you are covered for the sale or attempted sale of employee benefit plans, IRAs and Keogh retirement plans. Your administration of employee benefit plans (consultation with participants in an employee benefit plan in order to explain the provisions of such plan, enrollment, record keeping and filing reports with government agencies) is also covered. Additionally, you will be covered for qualified retirement plan design, if you use a Guardian Life prototype plan. Third party claims administration is not covered.
18. Am I covered for my activities related to property and casualty insurance?
You are covered for non-compensated referrals to property casualty agents as long as the referral is made in accordance with the following Guardian established procedures.
Guardian and Park Avenue Securities ("PAS") Financial Representative ("FR") and/or Registered Representative ("RR") of PAS providing referral guidance to any client/prospective client for the purpose of that client/prospective client purchasing and/or otherwise acquiring Property and Casualty ("P&C") insurance for any related personal and/or professional need MUST provide to that client/prospective client at a minimum three (3) separate P&C insurance company providers for the P&C insurance coverage contemplated, or recommend a properly licensed insurance brokerage outlet that offers the capability of soliciting P&C insurance from at least three (3) separate P&C insurance companies for the P&C insurance coverage contemplated. Failure to demonstrate and document /or otherwise comply with Guardian and/or PAS policy pertaining to the referral, solicitation and/or sale of P&C insurance will result in denial of your E&O insurance coverage that may otherwise be afforded to you for this activity under your existing E&O coverage.
You are not covered for the sale or service of property casualty products.
19. Am I covered for the sale of MEWAs? (Multiple Employer Welfare Accounts)
Yes, you are covered up to $500,000 per claim for the sale of a MEWA product provided that both of the following conditions are met: