Unfortunately most, if not all, commercial companies and organizations are vulnerable to fraud, theft, and embezzlement. Crime in the workplace is on the rise, occurring in even the best work environments. Through the use of computers and modern technology, criminals have developed more successful methods to attack and threaten the security of these companies and organizations.
What Is A Fidelity Bond?
A Fidelity bond is a financial guarantee that protects its policy holders from losses, either physical or monetary, they may incur due to dishonest or fraudulent acts caused by specified individuals. In most cases, a fidelity bond is obtained by an employer against loss caused by the dishonesty of an employee.
What is a Crime Insurance policy?
Crime insurance provides coverage to companies and organizations for losses that may occur from a variety of criminal acts. The three D’s in the policy refer to the following causes of loss:
A basic 3-D Crime Insurance policy only provides coverage under these three types. Although specialized coverage endorsements may be added to enhance the policy such as computer fraud, credit card forgery, and extortion. This policy is normally packaged with a fidelity bond.
What Does The Fidelity Bond Cover?
There are two main types of fidelity bonds:
Blanket fidelity bonds cover all employees the day the bond is issued, unless specifically excluded. New employees are automatically covered and conversely, cease to be covered when they are no longer employed. All employees are bonded for the same aggregate amount and the limit of liability applies "per occurrence".
Scheduled fidelity bonds provide coverage on employees named under the bond. It is only applicable to selected employees and each employee can be bonded for different amounts. The limit of liability applies per name or position scheduled.
What Coverage Is Not Included Under The Fidelity Bond?
You should be aware that fidelity bonds don't cover the following aspects in your business operation:
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