Section 13-03-24-04 - Required minimum amount of coverage1. The minimum required amount of fidelity bond coverage for any single loss is computed based upon a credit union's total assets. Assets | Minimum Bond |
$0 to $4,000,000 | Lesser of total assets or $250,000 |
$4,000,001 to $50,000,000 | $100,000 plus $50,000 for each million or fraction thereof over $1,000,000 |
$50,000,001 to $500,000,000 | $2,550,000 plus $10,000 for each million or fraction thereof over $50,000,000, to a maximum of $5,000,000 |
Over $500,000,000 | One percent of assets, rounded to the nearest hundred million, to a maximum of $9,000,000 |
2. This is the minimum coverage required, but a credit union's board of directors should purchase additional coverage when circumstances warrant. In making this determination, a board of directors should consider its own internal risk assessment, its fraud trends and loss experience, and factors, such as its cash on hand, cash in transit, and the nature and risks inherent in any expanded services it offers, such as wire transfer and remittance services.3. While the above is the minimum amount of bond coverage, credit unions should maintain increased coverage equal to the greater of either of the following amounts within thirty days of discovery of the need for such increase:a. The amount of the daily cash fund, i.e., daily cash plus anticipated daily money receipts on the credit union's premises; orb. The total amount of the credit union's money in transit in any one shipment.c. Increased coverage is not required pursuant to this subsection when the credit union temporarily increases its cash fund because of unusual events which cannot reasonably be expected to recur.4. Any aggregate limit of liability provided for in a fidelity bond policy must be at least twice the single loss limit of liability. This requirement does not apply to optional insurance coverage.5. Any proposal to reduce the required bond coverage must be approved in writing by the state credit union board at least twenty days in advance of the effective date of the reduction.N.D. Admin Code 13-03-24-04
Effective January 1, 2007.Amended by Administrative Rules Supplement 2022-384, April 2022, effective 4/1/2022.General Authority: NDCC 6-01-04
Law Implemented: NDCC 6-06-06