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§ 30.104. Bond and Insurance Coverage.

10 CA ADC § 30.104Barclays Official California Code of Regulations

Barclays California Code of Regulations
Title 10. Investment
Chapter 1. Commissioner of Business Oversight, Division of Financial Institutions
Subchapter 30. Credit Unions
Article 1. General Provisions
10 CCR § 30.104
§ 30.104. Bond and Insurance Coverage.
Currentness
A credit union shall be deemed to have obtained bond or insurance coverage for each officer, credit manager and employee (collectively and separately, the “individual”) having control of or access to funds or securities owned by or pledged with the credit union “commensurate with risks involved,” within the meaning of Section 14409 of the Financial Code, if all of the following conditions are met:
(a) NCUA Approval. The bond form or insurance policy has been approved in writing by the National Credit Union Administration.
(b) Additional Requirements. The bond form or insurance policy also:
(1) Provides coverage for loss of, or damage to, any property caused by the fraud or dishonesty of the individual or through the individual's failure to faithfully perform his or her trust.
(2) Contains a requirement that the issuer of the bond or insurance policy give the Commissioner at least thirty (30) days written notice prior to the termination of the bond or insurance in its entirety.
(c) Minimum Coverage Amount. The minimum amount of bond or insurance coverage required is computed based on the gross assets of the credit union in accordance with the following formula:
Assets
Minimum Bond or Insurance
$0 to $10,000
Coverage equal to the credit union's assets.
$10,001 to $1,000,000
$10,000 for each $100,000 or fraction thereof.
$1,000,001 to $50,000,000
$100,000 plus $50,000 for each million or fraction thereof over $1,000,000.
$50,000,001 to $295,000,000
$2,550,000 plus $10,000 for each million or fraction thereof over $50,000,000.
Over $295,000,000
$5,000,000.
And
(d)(1) Maximum Deductible Amounts. The maximum amounts of deductibles are computed based on the gross assets of the credit union in accordance with the following formula:
Assets
Maximum Deductibles
$0 - $100,000
No deductibles allowed
$100,001 - $250,000
$1,000
$250,001 - $1,000,000
$2,000
Over $1,000,000
$2,000 plus 1/1000 of total assets up to a maximum deductible of $200,000
(2) A deductible may be applied separately to one or more insuring clauses in a blanket bond or insurance policy.
(3) No deductible shall exceed ten percent of a credit union's regular reserve unless the credit union creates a segregated contingency reserve for the amount of the excess. Valuation allowance accounts (e.g., allowance for loan losses) may not be considered part of the regular reserve when determining the maximum deductible.

Credits

Note: Authority cited: Sections 14201 and 14409, Financial Code. Reference: Sections 14204 and 14409, Financial Code.
History
1. Change without regulatory effect renumbering former section 909 to new section 30.104 filed 8-19-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 34).
This database is current through 4/26/24 Register 2024, No. 17.
Cal. Admin. Code tit. 10, § 30.104, 10 CA ADC § 30.104
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