(a) The governing body of a Vermont financial institution shall direct and require good and sufficient fidelity bonds on all active officers, employees, and agents, whether or not they draw salary or compensation, which bonds shall provide for indemnity to the financial institution on account of any losses sustained by it as the result of any dishonest or fraudulent act committed or any omission by them acting independently or in collusion or combination with any person or persons. The bonds may be in individual, schedule, or blanket form, and the premiums therefor shall be paid by the financial institution.

(b) The governing body shall also direct and require suitable insurance protection to the financial institution against burglary, robbery, theft, and other similar insurable hazards to which the financial institution may be exposed in the operation of its business on the premises or elsewhere.

(c) The governing body shall be responsible for prescribing at least once in each year the amount or penal sum of those bonds or policies and the sureties or underwriters thereon, after giving due and careful consideration to all known elements and factors constituting the risk or hazards. That action shall be recorded in the minutes of the governing body. The Commissioner may require a financial institution to furnish an attested duplicate of the bonds and policies required by this section.

(d) The Commissioner may require a Vermont financial institution to secure additional bonds or insurance. (Added 1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001.)