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Downstream policy features added

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April 19, 2016

On May 1, Downstream Data Coverage (the NAID-developed professional liability policy) will introduce two policy language changes that strengthen its uniqueness.  Both changes will retroactively apply to all existing policies.

Rogue Employees: While NAID had written assurances from underwriters that it covered damages resulting from the acts of rogue employees, the policy language itself contained provisions that raised concern on this issue. As a result, NAID has pushed for new language that specifically states damages resulting from the intentional acts of rogue employees are covered by the policy. This important improvement eliminates the need for complicated interpretations and offline written assurances.

No Fault Defense: Of course, professional liability coverage also protects service providers by paying for legal defense when  they are falsely accused of causing damages. It is one of the primary reasons for having the coverage in the first place. As of May 1, and retroactive to all existing policies, if Downstream Data Coverage  is used for to pay for legal defense from false claims, where there is a finding of no fault, the deductible is reimbursed - costing the policyholder nothing.

NAID has several other policy features to enhance coverage to be announced as they roll out.

For more information on Downstream Data Coverage, contact NAID CEO Bob Johnson at rjohnson@naidonline.org.