The Financial Industry Regulatory Authority (Finra) is mulling over mandating brokerage firms to have ‘errors and omissions’ insurance that can cover damages caused due to negligence or misconduct of brokers.

Commenting on the requirement, Finra regulatory operations executive vice president Susan Axelrod was quoted by the Wall Street Journal as saying, "We’re going to evaluate the whole area and see if there are additional steps we can take."

Finra said $51m of arbitration awards granted in 2011 haven’t been paid, reported WSJ.

As per norms of the Securities and Exchange Commission (SEC), small brokerage firms should have a net capital of at least $5,000. Many smaller brokerage firms operate with lesser net capital specified by the SEC, said the newspaper.

Finra is the largest independent regulator for all securities firms doing business in the US.