ABA hosts conference Nov. 10-11 on financial institution bonds

Over the last eight years, there has been a sea change in how banks and other financial institutions conduct business, and these changes directly impact how fidelity insurers and their financial institution insured view the coverages offered by financial institution bonds. Those changes, in particular the way computers and technology have taken over the way business is conducted, will be among topics discussed at the American Bar Association’s Fidelity & Surety Law Committee’s Fall 16 Meeting on Nov. 10-11 in Chicago.

Other program highlights include:

• “Construction and Interpretation (Contra Proferentem and Reasonable Expectations)” — Insurance coverages run such a wide gamut that a “one-size-fits-all” approach to the interpretation of insurance policy language is utterly inappropriate. Yet this is just the approach some courts take, applying principles and rationale applicable to the interpretation of completely unrelated and dissimilar coverages to the interpretation of the language of financial institution bonds. Attorneys Adam Friedman, Chiesa Shahinian & Giantomasi PC, West Orange, N.J.; and Amanda Brunkhorst, Merchants Bonding Company, Des Moines, Iowa, will discuss the state of the law and why courts should not interpret financial institution bonds in the same manner that they interpret policies of fire insurance or automobile insurance.

• “Who Is a Covered “Employee” — Whether or not a given individual is an “employee” under the Bond is often a threshold issue in determining coverage for a loss. Panelists will distinguish employer-employee relationships from nonemployment relationships by examining common law and contractual concepts such as an employer’s right to “direct and control” an employee, and the requirement that an employer directly compensate an employee. The so-called “alter ego” defense will be discussed. Emphasis will be placed on recent changes in the Bond’s definition of “employee” and how these changes are likely to impact courts’ understanding of the term. Speakers are: Armen Shahinian and Andrew Kent, both from Chiesa Shahinian & Giantomasi PC, West Orange, N.J.; and Otto Elkins, ABA Insurance, Mayfield Heights, Ohio.

• “Critical Considerations In The Insurer’s Handling of the Claim, Both Pre-Suit and During Litigation” — This presentation provides practical tips on how to approach the task of defending an action brought under the Bond and how best to get the right result. This is an A to Z analysis, beginning with the complaint and ending with a jury trial, a must for all fidelity practitioners. While the defense of a Bond action may be similar to the defense of other insurance policies in many ways, this program will highlight how they are different and how to win. Speakers are: Gary Valeriano of Anderson, McPharlin & Conners LLP, Los Angeles; and Robin Sondak, Travelers Bond & Specialty Insurance, Hartford, Conn.