CPCU 552 Chapter 7 Objective 7 Exam
Questions With Revised Answers
Fiduciary Liability Insurance - answerInsurance that covers the fiduciaries of an employee
benefit plan against liability claims alleging breach of their fiduciary duties involving
discretionary judgment.
Describe the four majo...
Fiduciary Liability Insurance - answer✔✔Insurance that covers the fiduciaries of an employee
benefit plan against liability claims alleging breach of their fiduciary duties involving
discretionary judgment.
Describe the four major fiduciary duties of a preson involved in the design, administration,
funding or management of a benefit plan or its assets. - answer✔✔...loyalty
prudence
diversification
adherence
Describe the meaning of an insured plan in a fiduciary liability policy - answer✔✔An insured
plan in a fidcuciary liability policy usually means (1) any ERISA employee benefit plan operated
by the insured or jointly by the insured and a labor organization for the benefit of the sponsor's
employees and (2) any other employee benefit plan sponsored solely by the insured for the
benefit of its employees.
Describe the three elements typically included in the definition of wrongful act covered by a
fiduciary liabilty policy. - answer✔✔The definition of a wrongful act covered by a fiduciary
liability policy usually includes a breach of the responsibilities, obligations, or duties, imposed
on fiduciaries of an insured plan by ERISA or by the common or statutory law of the U.S. or
other jurisdiction; any other matter claimed against insureds soley because of their service as
fiduciaries of any insured plan; a negligent act, error, or omissionm solely in the administartion
of any insured plan.
Describe how the exclusion for obligations under workers compensation, disability, and
unemployment laws in D&O policies differs in EPL policies.. - answer✔✔Fiduciary liability
policy exclusions usually include an exception to the exclusion for obligations under workers
compensation or similar laws to cover claims arising under the Consolidated Omnibus Budget
Reconciliation Act (COBRA)
Describe the excepion to the exclusion for fines and penalties in EPL policies. -
answer✔✔Fiduciary liability policy exclusions often contain an exception yo the exclusion of
fines and penalties imposed by ERISA.
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