Financial Institution Crime Bonds
Fidelity insurance protects organizations from loss of money, securities, or inventory resulting from crime. Common Fidelity claims allege employee dishonesty, embezzlement, forgery, robbery, safe burglary, computer fraud, wire transfer fraud, counterfeiting, and other criminal acts.
These schemes involve every possible angle, taking advantage of any potential weakness in your company’s financial controls. From fictitious employees, dummy accounts payable, non-existent suppliers to outright theft of money, securities and property. Fraud and embezzlement in the workplace is on the rise, occurring in even the best work environments.
Liabilities covered by crime insurance usually fall into two categories, although many polices combine both types of coverage:
- money and security coverage pays for money and securities taken by burglary, robbery, theft, disappearance and destruction.
- employee dishonesty coverage pays for losses caused by most dishonest acts of your employees, such as embezzlement and theft
Why do I need Fidelity Insurance?
Fraud and embezzlement in the workplace is on the rise, occurring in even the best work environments. According to a leading international accounting firm:
- 80% of workplace crime is carried out by employees
- One in four employees has either committed or witnessed workplace fraud and abuse
- One in four employees committing fraud against their employer has been with the company for more than 10 years
- Only one in three of those who have witnessed a workplace crime bother to report it
The Association of Certified Fraud Examiners has found that:
- Fraud and abuse costs U.S. businesses more than $400 billion annually
- Fraud and abuse costs employers an average of $9 a day per employee
- The average organization loses 6% of its total annual revenue to fraud and abuse committed by its own employees
These frauds can go on for years, and when discovered the ultimate impact can be enormous. Smaller companies are especially vulnerable to Fidelity crimes.
Most business insurance policies either exclude or provide only nominal amounts of coverage for loss of money and securities as well as employee dishonesty exposures.
The American Management Association has estimated that employee dishonesty causes as much as 20% of the nation’s business failures.
White collar crime can have serious financial consequences, even threatening a private company’s survival. InsureHedge offers a solution to handling crime losses committed by employees, through ForeFront Crime Liability Insurance Policy.