Commercial Crime Bond

Commercial crime bonds, also known as “Employee Theft” or “Employee Dishonesty” bonds are a subset of the broader category of fidelity bonds that provide protection to a business (the “insured”) for losses resulting from the fraudulent or dishonest acts committed by its employees.

Commercial crime bonds can be subdivided into 2 primary types based on the coverage desired:

• 1st Party Coverage: Provides protection should an employee steal from it’s employer (the insured), and;
• 3rd Party Coverage: Provides protection should an employee steal from the customer’s of the insured.

Businesses can purchase policies that contain both 1st Party and 3rd Party coverage, along with a variety of other coverages called “insuring agreements”. The following insuring agreements are available in most commercial crime bonds:

• Employee Theft (1st Party): Covers loss resulting from theft of the insured’s property by an employee .
• Employee Theft – Clients Property/Premises (3rd Party): Covers loss resulting from theft of the insured’s client property by an employee.
• Forgery or Alteration: Covers loss resulting from the forgery or alteration of checks, or other similar promises to pay drawn upon the Insured.
• Theft of Money and Securities and Other Property – Inside the Premises: Covers money, securities, and other property holding intrinsic value inside the premises or while on deposit at a bank or financial institution against theft, disappearance, or destruction.
• Theft of Money and Securities and Other Property – Outside the Premises:  Covers money, securities, and other property holding intrinsic value against theft, disappearance, or destruction while outside the premises and in the care and custody of either a messenger or an armored vehicle company.
• Computer and Funds Transfer Fraud: Covers loss resulting from the use of any computer to fraudulently transfer money or other valuables and from loss resulting from the communication of fraudulent transfer instructions to a financial institution.
• Money Orders and Counterfeit Money: Covers loss resulting from the acceptance of counterfeit paper currency or money orders that are not paid when presented.