Here`s what else we know: Some industries are more affected than others. Banking and financial services top the list, while manufacturing, retail and construction companies are not far behind, according to a 2018 study by the Association of Certified Fraud Examiners. Employees, contract workers and volunteers are all sensitive to the temptation to steal. Example: From petty thefts to scams, employees are constantly tempted to steal due to a lack of security, peer pressure, or critical needs. Umbrella liability can be a great solution for a business that needs more liability coverage than is offered in its general liability, employer liability or automobile liability regime. The roof can be purchased as a stand-alone policy or bundled with general liability insurance. Directors and officers of a private corporation are exposed to lawsuits brought by various individuals such as customers, competitors, suppliers and government agencies. However, most lawsuits against directors and officers themselves come from the employees of a company. D&O Insurance covers your management team if they head south. Money transfer fraud – This coverage protects your business from fraudulent instructions to a bank or financial institution that cause it to transfer money from your account. So, if you think your business can`t afford to lose money, valuable goods, or supplies, you should read the following White-Collar Crime/White-Collar Crime Insurance FAQ: Litigation damages, indirect losses (such as business interruptions), legal fees, and criminal acts committed by business owners or senior management are not covered by liability insurance. It`s not just big companies that need to worry. The latest report from the Association of Certified Fraud Examiners found that organizations with fewer than 100 employees see the largest proportion of fraud cases – 28%.
White-collar crime is a significant burden on businesses. According to the Association of Certified Fraud Examiners (ACFE), U.S. organizations are responsible for more than $400 billion each year, through fraud and abuse alone. The problem is widespread, although small businesses are the most vulnerable to commercial crime, partly because they have fewer staff to implement security and audit procedures, and partly because the small size of these businesses means that owners and managers tend to trust their employees personally as they have more contact with employees every day. Now you might say, “Really?! What is the purpose of insurance then? But these exclusions make sense when you think about how easily insurance fraud could be committed without them. Most importantly, now that you know these exclusions exist, it`s time to think about closing the gap with white-collar crime insurance. Crime is a serious business threat. Whether you are a victim of internal or external crimes, the owner or manager of the business must take responsibility for the stolen money, data or property. What about the sales manager who stole $1.6 million in customer payments and tried to cover things up by presenting fraudulent checks? In this particular case, the employer was underinsured, so his insurance company paid only $500,000 of his losses, leaving him with $1.1 million. It is not possible to monitor your business 100% of the time.
Liability insurance allows you to recover losses caused by criminal acts that are not covered by other insurance plans. Most companies have commercial liability insurance, and some companies maintain loyalty insurance. Both types of insurance protect against losses caused by the company or its employees, as well as lawsuits brought by third parties. Some companies may also take out business interruption insurance that covers the risks associated with normal business operations. ISO (an organization that defines the standard language of insurance policy) divides white-collar crime insurance into eight different sections: one for employees, seven for external authors. Each section describes different terms and provisions. Some insurance companies borrow this wording literally in their crime insurance policies; others select and select only parts of the ISO language. Therefore, it is important to think about the different types of theft that could affect your business. Ask your agent to guide you through some of today`s common scenarios. He or she can explain which policies and/or endorsements meet your needs.
Loyalty insurance protects contractors from dishonest employees. Companies that provide certain employees with access to confidential information, such as . B financial institutions benefit from loyalty insurance. Loyalty insurance covers unauthorized employee activities, asset protection, external fraud and technology risks. Loyalty insurance is also known as a bond because the loyalty guarantee reimburses the business owner for damages caused by dishonest employees. For example, cashiers, bank employees, officers and directors are generally covered by employer loyalty insurance. Some insurance policies contain unavailability clauses and the wording of the contract can be ambiguous. Most insurance policies can be terminated by either party, and there is usually a grace period for late payments. However, as mentioned above, white-collar crime coverage can be structured in different ways, depending on your carrier`s offers and the wording of its policy. In addition to purchasing a basic crime insurance policy, you may need to select certain endorsements to ensure you meet your main risks.
For example: This insurance protects goods on the way to land transport, as well as the property of others that are located on your premises or transported from your premises. An inland navigation policy is crucial if your company ships goods of any kind ashore. White-collar crime insurance is a line of coverage specifically designed to protect businesses from theft and fraud. Because it helps fill some important gaps between what commercial property insurance covers and what doesn`t, it is most often associated with employee theft. And you may see that this is called “loyalty insurance,” “employee theft coverage,” or “employee dishonesty coverage.” A business can also purchase white-collar crime insurance as a stand-alone policy to add to other policies or insurance packages it has purchased. By purchasing a standalone policy, the company can specify the types of crimes that the policy is supposed to cover, which can be useful for businesses that are susceptible to some types of commercial crime, but not others. For more information on white-collar crime insurance, please contact our team of experts at 508.339.2951. While it may be hard to imagine the reality that your employees, even if they are family members, would steal from you, they do. The most common claim to a crime insurance policy is employee dishonesty. Unfortunately, it is often the employees who are related to the business owner or very good friends with him. When you or your employees go to the client`s home or office to do your job, this is where reporting third-party crimes comes into play.
It protects you from claims that you or your employees have stolen from the customer while you are doing your work on their farm. White-collar crime insurance is available because most commercial or commercial real estate insurance policies do not cover crime-related losses. Businesses can purchase white-collar crime insurance as part of an industry insurance policy, also known as “special multi-risk insurance,” which is a set of different policies aimed at protecting the business from crime, property damage, liability, and other types of potential loss situations that a business might encounter….