Answers to your common questions about the professional liability insurance coverage and legal fee reimbursement benefit.
Question: Is the $1 million dollar limit shared or does each member receive their own individual policy limit?
Answer: Each member gets their own individual $1 million legal reimbursement limit ($2 million for each member of a unified state).
Question: Are disciplinary, administrative, and license revocation proceedings covered?
Answer: The policy does not cover actions instituted by the state. In order to be covered, actions need to be instituted by the employer, school, or school district (they must have the authority to bring an employment action against the employee).
Question: Are there any instances where there is coverage for an action or proceeding commenced by the NASSP member, such as an arbitration to enforce contract rights or actions against the state retirement system over a benefit determination?
Answer: This is a defense expense policy, so there is no coverage for legal action commenced by the member. However, if there is a covered job action and the claim transitions to contract negotiations because the employee (insured) has decided to terminate their employment, then coverage would be provided.
Question: The website says the insurance company will “assign and defend” any civil suit. What about instances where the assignment and defense are undertaken by either the state professional association or the district itself?
Answer: The NASSP policy is an excess policy. If a defense is provided by the school district errors and omissions (E&O) policy, the NASSP policy would be excess. The NASSP policy would only provide a defense if the insured is denied a defense by the school district E&O policy. Sometimes there are allegations in a civil suit that are denied in the school district’s E&O policy. The NASSP policy would then provide the defense.
Question: Is it true that there is an exclusion denying coverage if it is found that the member acted fraudulently with bad intent?
Answer: There is no coverage for intentional fraudulent acts. If, however, the member is found innocent of the criminal charges, then the NASSP policy provides some defense reimbursement. The member’s innocence must be substantiated.
Question: The policy refers to circumstances under which a member defending themselves in a criminal action may have legal expenses reimbursed. What is the policy limit and under what conditions is coverage provided?
Answer: The legal expense reimbursement limit is $14,500. Criminal charges must first be filed in order for coverage to apply and the member must be able to substantiate that they were found innocent or otherwise exonerated of the charges.
Question: Does this coverage protect me only if I’m found not guilty?
Answer: You’ll be protected against exposures in civil suits such as failure to educate or violation of student civil rights whether you’re at fault or completely innocent. However, in the event of criminal charges such as sexual abuse or charges arising out of corporal punishment, the policy will respond with limited defense reimbursement if you are found not guilty or the charges are dismissed.
Question: How can a member appeal a claim determination? What should we do if we are not getting a response from the carrier?
Answer: The member/insured can always appeal a claims declination. The carrier will provide the reasoning for a claims declination and it will encourage the insured to provide additional facts. Any member who is not getting a prompt response from the carrier can contact Fred Wheeler with the insurance administrator at 703-318-8189, and he will assist with the claim.
Question: When are NASSP members covered?
Answer: The member’s active membership date is validated by NASSP. The NASSP plan will provide coverage for claims that occur and are reported during the policy period or after the retroactive coverage date.
Question: Who is eligible for this plan?
Answer: A list of eligible members is provided by NASSP.These members must be W-2 employees of an educational entity, e.g., school, university, or college. This must be the member’s primary occupation. Owners and board members are not eligible for coverage.
Question: Does coverage require membership at the time of the incident and at the time the claim is made? If so, should retired members continue their membership?
Answer: This is a claims-made and reported policy. It is prudent for retired members to continue their coverage. The policy would cover the member/insured until the statute of limitations expires or, in some cases, until the student reaches the age of 21.
Question: In the exclusion section of the policy, one acting as an independent contractor is excluded. That would exclude most, if not all, interim or per diem work that regularly occurs. How can these members be covered?
Answer: If an NASSP member cannot meet the employee redefined definition in the policy, they would not be eligible for the in-dues coverage. The member might have recourse to purchase a private practice professional liability policy on a voluntary basis, if the applicant can verify that they are insured under the school district’s E&O policy. This coverage is available through NASSP’s insurance administrator.
Question: Won’t my school have liability insurance? Why should I have my own coverage?
Answer: Both defense cost and indemnification are paid within the limit for professional liability claims.
Question: Are lawsuits against educators increasing?
Answer: Yes, as part of a general trend in increased litigation, the number of lawsuits against schools and teachers has been rising over the last decade.
Question: How much has the carrier paid in professional liability and job protection claims in the last 3 1/2 years?
Answer: For the policy period beginning September 2016 to June 2020, there were 199 job protection claims totaling $499,194. There were also 46 professional liability claims totaling $155,302 for that same period.
Question: Are there health-related exclusions in the professional liability policy?
Answer: Yes. The policy does not cover health issues arising out of or related to the exposure to:
A. Fungi, including but not limited to mold, mildew, and yeast
D. Dust, spores, odors, particulates, or byproducts, including but not limited to mycotoxins and endotoxins, resulting from any of the organisms listed in A, B, or C above, from any source whatsoever
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