Felonious Assault Coverage for Financial Institutions

Unique and Valuable Protection that Every Bank Should Consider

By Philip Talley, Vice President Insurance Services, Illinois Bankers Association

Every successful banker knows that a bank’s most valuable assets are the bank’s employees, the people who interact with customers daily and help to build relationships with the bank’s clients and the community. Unfortunately, bank employees face an increased risk of on the job assaults. According to Bank Crime Statistics reported by the FBI, in the five-year period from January 1, 2014, to December 31, 2018, there were 19,273 robberies and other incidental crimes committed against federally insured financial institutions in the United States. A firearm, or other type of weapon (including knives and explosives), was used in 3,970 of these incidents. During the commission of these crimes, a total of 131 employees were held hostage, and 130 employees were injured or killed.1 It is important to note that this is not an exclusively urban problem, of the 19,273 incidents that occurred from 2014 through 2018, 3,673 occurred in suburban communities, 5,945 occurred in a “small city/town” and 491 occurred in rural communities. No bank is immune to this risk. These are very sobering statistics for bank managers as they strive to keep employees safe during a time of increased social unrest, rioting, and looting.

In most cases, an on the job assault causes more than just physical injury, these assaults can also have a devastating impact on the employee’s mental health, and they can even cause severe anxiety for the employee’s family. In cases of felonious assault, Worker’s Compensation is often not enough to meet all the medical bills and mental health care that is needed.

In order to help banks protect the emotional and financial wellbeing of employees that are assaulted on the job, or to help compensate the family of an employee that is killed as a result of an on the job assault, Chubb has introduced a unique type of Accidental Death and Dismemberment (AD&D) policy that provides benefits to bank employees that are injured on the job as a result of a felonious assault. Chubb’s Felonious Assault Coverage for Financial Institutions was designed specifically for banks and other types of financial institutions. It pays benefits in addition to Worker’s Compensation.

Like most other AD&D plans, it pays a schedule of benefits that are determined by the severity of the injury. The policy has a “Principal Sum” of $200,000. The “Schedule of Covered Losses” is as follows:

- 100% of Principal Sum: Loss of Life; Speech and Hearing; Speech or Hearing and one of Hand, Foot, or Sight of One Eye; Both Hands, Feet, Sight, or a combination of any two of Loss of Hand, Foot, or Sight of One Eye; Quadriplegia

- 75% of Principal Sum; Paraplegia

- 50% of Principal Sum: Hemiplegia; Hand, Foot, or Sight of One Eye; Speech or Hearing

- 25% of Principal Sum: Uniplegia; Thumb and Index Finger on Same Hand

In addition to the benefits outlined above, this policy also includes an “InHospital Benefit”. This benefit applies if an insured employee suffers a covered loss resulting in hospital confinement. The daily benefit amount is $500 and will be paid while the insured remains in-hospital. This benefit is subject to an elimination period of 3 days and can be paid up to a maximum of 14 days.

If an insured employee needs psychological therapy, as is often the case after an assault, this plan includes a “Psychological Therapy Expense” reimbursement. This benefit reimburses expenses for psychological therapy as required by a Physician, due to a covered assault. The policy will pay up to 5% of the Principal Sum for expenses incurred for treatment. This benefit is payable on an excess basis for treatment that occurs within two years of the covered accident, subject to a total benefit maximum of $25,000.

The premium for this coverage is based on the bank’s employee count. Chubb has made this important coverage very affordable, so it is a coverage that every bank should consider. Having an employee killed or injured on the job because of a felonious assault may seem like a nightmare scenario, but unfortunately it occurs much too often. This policy enables your bank to protect an assaulted employee’s financial security and it provides vital benefits that will help an employee during a time of need. Should an employee die as a result of an on the job assault, this policy will help compensate the employee’s family and help them cope with all of the difficulties that come with losing a loved one, particularly if the deceased was the family’s primary wage-earner.

Illinois Bankers Insurance Services offers this coverage through our partnership with IBA associate member, Mid America Banking Insurance Services, Inc. To learn more about how you can protect your bank’s employees, please contact Philip Talley, ptalley@ilbanker.com.