NU Online News Service, Oct. 13, 3:40 p.m. EDT

Passage of the Dodd-Frank Act will mean a lot of changes in the world of finance, but having a current professional liability policy should grant executives some security in the case of litigation, said one insurance expert.

During a webinar sponsored by the Professional Liability Underwriting Society, titled The Dodd-Frank Act: Underwriting, Claims and Risk Management Implications, Carol A.N. Zacharias, senior vice president, deputy general counsel, North America for ACE Group, said despite all the uncertainties surrounding implementation of the Dodd-Frank Act, a current professional liability policy should provide adequate coverage.

"I think the first thing one needs to do is look at what one has in their existing directors and officer policy," noted Ms. Zacharias.

A policy should provide coverage for civil actions, administrative and regulatory proceedings, criminal proceedings, and investigations by regulators, she noted. Under the Dodd-Frank Act, there could be increased scrutiny from regulators.

In tandem with a D&O policy, there should be a current employer's practices liability policy in place as the law has expanded the role of whistleblowers. She explained that if someone has been a whistleblower and is subsequently let go from their job, they can say it was a retaliatory act and sue.

What is not known is whether the new law will lead to an increase in proceedings and litigation from other areas of government or whistleblowers, she noted.

"We are watching," she said, adding that a lot of regulation still needs to be written.

"Your policy should be alright if you've got a modern policy in place that provides coverage for these types of proceedings," Ms. Zacharias said.