On October 10, 2013, the Federal Deposit Insurance Corporation
("FDIC") issued Financial Institution Letter 47-2013 to
warn insured depository institutions of two areas of concern for
director and officer insurance policies. First, the FDIC has noted
an increase in exclusionary terms or provisions contained in
institutions' D&O insurance policies "that may
adversely affect the recruitment and retention of well-qualified
individuals." The FDIC also suggests that directors and
officers "may not be fully aware of the addition or
significance of such exclusionary language." In order to
address this area of concern, an institution should conduct a
review of all of its insurance policies, including D&O
policies, on a periodic basis. It is not enough that directors and
officers are provided with an overview of the institution's
D&O coverage when the director or officer is on-boarded.
Rather, as the institution's risk profile changes, so must the
institution's self-assessment
