Crime Insurance: Owning a business is taking risks. They have not yet invented a way to undertake without taking risks, however, there are risks and risks. While you risk everything on a new business or putting your face on the street to make that business fly, you need to make sure that what you’ve already achieved is safe.
We have already talked about more traditional insurance such as CPP or Commercial auto insurance , but unfortunately, the risks are very varied and certain protections need specific coverage.
Crime insurance protects you from losses resulting from criminal acts, such as theft, looting and theft, even if committed by employees.
Types of Crimes
Table of Contents
Crime Insurance protects you from incurring losses due to crimes involving property or money and securities. But which crimes are usually covered?
- Burglary is the attempted removal or actual removal of property(s) from within your premises by someone who enters or leaves illegally.
While entry evidence is not required, we often find evidence such as marks made by tools, explosives, chemicals or electricity.
- Safe Burglary When something is stolen from a locked safe, you can prove the theft with the forced opening marks on the outside of the safe.
It also includes situations where the entire safe is taken illegally.
- Robbery (assault) when stealing in front of another person and taking property through threat or even through assault.
- Theft is a broader term and includes robbery, assault and theft. However, unlike the other crimes, which necessarily involve the use of force, theft also includes stealth taking of property (action intended to go unnoticed, such as shoplifting ).
- Forgery is signing your company name with the intent to deceive.
- Mysterious disappearance for missing properties, without theft. If we keep losing keys, cell phones and glasses around, imagine how many things disappear in a company?
What does Crime Insurance cover?
Commercial crime insurance covers the following cases:
- employee theft
- Forgery or alteration
- Inside the premises – theft of money and securities
- Inside the premises – robbery or safe burglary of other property
- Outside the premises
- computer fraud
- Money orders and counterfeit paper money
- funds transfer fraud
- Extortion—commercial entities
- guests’ property
To be clear, we explain each of the cases:
employee theft
Also known as employee dishonesty , employee theft coverage pays for loss of or damage to cash, securities, and other property resulting from theft or forgery committed by an employee acting alone or in a group.
In this case, the proof cannot be the lack of a product in stock or a hole in the bills at the end of the month.
There is no coverage for:
- an employee who previously had similar insurance canceled and not reinstated;
- loss resulting from trading, whether in your name or on a genuine or fictitious account;
- loss resulting from fraudulent or dishonest use of deposit slips.
There are three ways a company can cover employees against theft.
- Programmed Name – Employees are listed by name.
- Scheduled Position – Only listed positions within the company are covered, such as branch manager, accountant, etc. Employees who hold the covered positions are not listed.
- Blanket – all employees are covered.
Forgery or alteration
Counterfeiting or alteration coverage pays for losses caused by forgery or alteration of checks, drafts, promissory notes or even documents, made, withdrawn by or on you or another representative of your company.
Coverage is provided worldwide. However, this coverage excludes acts of employee dishonesty as this would be covered by employee theft.
Inside the premises – Robbery or Safe Burglary of Other Property
Inside the Premises – Theft or safe theft of another property has two main coverages:
- Covers damages in the event of theft occurring within the company’s premises. Cash and bonds are NOT covered.
- Covers damage to safes, safes, cash registers, cash registers and cash drawers locked inside the premises caused by attempted or actual theft.
If you own the premises or are responsible for damage to the premises, this coverage also covers damage to the interior or exterior resulting from the attempt or theft of a safe.
Outside the premises
Off-premises offers two types of coverage:
- Theft, disappearance or destruction of cash and securities while off-premises and in the care and custody of a courier or cash-in-transit company.
- Loss of property due to theft or attempted theft while off premises and in the care and custody of a courier or armored car company
computer fraud
Computer fraud coverage is offered worldwide and covers losses caused by using any computer to fraudulently transfer money, securities or other property from within the financial institution’s premises or facilities:
- to a person (other than a Messenger) outside the Facilities or Facilities of the Financial Institution;
- to a location outside the financial institution’s premises or premises.
Money orders and counterfeit paper money
Counterfeit money orders and paper money keep you from seeing ships and cover damages when you or an employee accepts invalid money orders or counterfeit money in good faith.
funds transfer fraud
Money transfer fraud covers the loss of a bank scam when someone successfully impersonates you or an employee of your company and convinces the bank to make payments and transfers from your account.
Losses resulting from the use of a computer to fraudulently transfer money, securities or other property are not covered.
Extortion—commercial entities
Extortion – commercial entities pay the losses resulting from an extortion. Including payments made under physical threats to your employees or relatives, even guests captured in covered territories.
guests’ property
Guest Property covers cash, titles and other property owned by hotel guests while:
- on your premises;
- in your possession;
- in a safe on your premises.
titles
A bond is a financial contract that promises to pay cash (called a penalty) if a promise made by one party to another is broken.
The promise can be to do or not to do a certain action. There are two basic types of titles:
- Loyalty bonds often cover employee dishonesty.
- Surety bonds are three-party contracts used in commercial, court or construction contracts.
But how do titles work? Let’s explain:
parts of a title
There are many similarities between insurance policies and bonds (insurers often issue both), but there are also some important distinctions.
Insurance contracts include two parties: the insured and the insurer. Bonds are contracts between three parties:
- Principal – the part that promises to do (or not do) an action. The duration and type of bond required will depend on the principal ‘s obligations .
- Surety – the party (usually the insurer) that is fiscally responsible (pays the fine) if the principal fails to pay the bond.
- Obligee – the party to whom the principal makes the promise and for whom the protection will be active.
penalties
penalties
- Surety Bonds
Surety bonds promise to pay if the principal fails to meet its obligation. The obligee requires the principal to purchase this security as collateral.
- Contract Bonds
Contract bonds are contractual obligations that guarantee the fulfillment of a contractor’s obligations. The contractor is the principal who makes the promise to the customer ( obligee) .
The most common contract bonds are:
– Bid bonds or bidding bonds are awarded to the lowest bidder with a guarantee that, if the contractor’s bid is accepted, the contractor will enter into the contract at the quoted price
– Performance bonds or performance guarantee guarantees that the contractor will complete the work as described in the contract, protecting the obligee from financial loss if the contractor does not complete the project
– Payment bonds or payment bonds guarantee that the contractor will pay suppliers and subcontractors to keep the project free of encumbrance
– Supply bonds or supply bonds – guarantees that materials will be available at an agreed price and time.
- Court Bonds
Court Bonds is used to describe bonds that may be required in court proceedings.
The most common are:
– Fiduciary bonds or fiduciary bonds are used to bind guardians, trustees, trustees and executors or persons appointed by a court to administer to the property of a third party.
– Judicial bonds or judicial bonds are issued to protect plaintiffs or defendants from possible pending losses from civil lawsuits.
There are still other types of bonds that can fit exactly what you need for your business.
