Employee Fidelity Guarantee Insurance

Any business that employs individuals in positions of trust, especially those handling finances, assets, or sensitive data, should consider this insurance.

It covers theft, embezzlement, forgery, misappropriation of funds, manipulation of accounts, and other fraudulent or dishonest activities by employees.

Yes, the policy covers losses arising from theft by employees.

It reimburses the insured for direct financial losses due to employee fraud, provided the fraudulent act is discovered within the policy period or specified discovery period.

The discovery period is typically 12 months after the policy expires or the employee’s departure, within which the fraudulent acts must be discovered for coverage to apply.

Industries that handle large amounts of cash, assets, or sensitive information, such as banking, retail, healthcare, and IT services, benefit most from this insurance.

Yes, with certain add-ons, it can cover fraudulent acts that affect third parties, such as clients or partners.

The policy covers fraud detected within the discovery period, which is usually 12 months after the policy expires.

Exclusions include losses from acts committed after the discovery of fraud, non-financial losses, and losses outside the policy’s territorial limits, among others.

Typically, the policy does not cover intellectual property theft unless specifically mentioned or covered under an additional rider.

Yes, businesses can customize the policy with add-ons based on their industry needs and risk exposure.

Crime insurance covers a broader range of criminal acts, while Employee Fidelity Guarantee Insurance specifically covers fraud or dishonesty by employees.

Upon discovering fraud, the insured must notify the insurer, file a police report, and submit all relevant documentation. The insurer will investigate and process the claim accordingly.

Documents such as proof of loss, financial statements, internal investigation reports, police reports, and relevant business records are required.

By implementing strong internal controls, conducting regular audits, and ensuring segregation of duties, businesses can reduce fraud risk.

Add-ons can include third-party fraud coverage, extended discovery periods, and coverage for legal expenses or inventory theft.

Theft, embezzlement, misappropriation of funds, forgery, and manipulation of financial records are common causes of loss covered.

Yes, non-profits can benefit from this insurance to protect against financial losses caused by fraudulent acts of employees.

The underwriter assesses the risk associated with insuring a business and sets the premium and coverage limits accordingly.

Generally, the policy does not cover losses related to bribery, unless specifically included in the policy terms.

Yes, if the employee colludes with a vendor to defraud the business, the policy can cover the loss, subject to policy terms.

The policy covers financial losses resulting from the embezzlement of company funds or assets by employees.

Yes, the number of claims is usually limited to the policy’s aggregate limit, and no further claims can be filed once the limit is reached.

Yes, some policies may include coverage for cyber fraud committed by employees, especially if there is a clear link to employee dishonesty.

It depends on the policy. Some policies allow coverage for temporary or contract employees if specified in the policy schedule.

Fidelity bonds provide protection against employee dishonesty, similar to Employee Fidelity Guarantee Insurance, but are usually required by law or regulation for certain positions.

The policy covers former employees if their fraudulent acts are discovered within the discovery period.

The sum insured is the maximum amount the insurer will pay for a covered loss, and the payout will not exceed this limit.

In some sectors, such as finance, it may be legally required or strongly recommended as part of risk management practices.

Yes, the policy typically covers losses resulting from forgery committed by employees.

The policy covers financial losses caused by fraudulent manipulation of financial records by employees.

The business should immediately investigate the issue, notify the insurer, and take steps to prevent further loss.

The premium is based on factors such as the number of employees, the nature of the business, and the level of coverage required.

Yes, fraud related to payroll or bonuses is typically covered under the policy.

Coverage may exclude certain types of employees, such as temporary workers or contractors, unless explicitly included in the policy.

If the fraud is detected within the discovery period, the policy will cover the loss, even if the employee has resigned.

Yes, the policy can cover losses caused by collusion between multiple employees, subject to policy terms.

Some policies offer add-on coverage for legal fees incurred during fraud investigations or court cases.

Yes, some policies allow for international coverage, but this may require an additional premium or a separate rider.

If the acts are related or part of a series, they may be treated as a single claim. Otherwise, they will be processed individually, subject to the policy limits.

First-party coverage protects the business from internal employee fraud, while third-party coverage protects the business from fraud that affects external clients or partners.

By encouraging businesses to implement preventive measures and auditing practices, the policy supports better internal fraud detection and prevention.

No, the policy typically excludes breaches of contract unless the breach is directly linked to employee dishonesty.

Look for experience in handling claims, flexible coverage options, a strong financial standing, and good customer service.

The claim may be withdrawn, and any actions against the employee may be reconsidered. The insurer will typically investigate before processing a claim.

Surprise audits act as a deterrent to employee fraud by ensuring continuous monitoring of financial activities.

Employee Fidelity covers employee fraud, while D&O Insurance covers the actions of directors and officers in their official capacity.

A past fraud claim may increase premiums or affect the insurer’s willingness to renew the policy.

The maximum liability is determined by the sum insured for each employee, as specified in the policy.

Yes, but all acts may be aggregated into a single claim, depending on the policy terms.

If discovered within the policy’s discovery period, the loss is still covered, even if the employee has left the company.

Typically, the discovery period is limited to 12 months, and losses discovered after this period are not covered.

Yes, the policy usually applies within the geographical region specified in the policy, but international coverage can be added with a rider.

Yes, if the losses are discovered during a routine audit within the discovery period, they are typically covered.

No, indirect losses like loss of profits or business interruption are generally excluded from coverage.

Only if international coverage has been included in the policy; otherwise, losses outside India are typically excluded.

The insured must provide financial records, proof of loss, police reports, and any other relevant documentation requested by the insurer.

Legal liabilities are not usually covered unless specifically included in the policy terms.

The sum insured is based on the employee’s role, risk level, and the nature of the business.

Is there an excess amount that the insured has to bear before the policy responds?

Casual or temporary employees may be covered if specified in the policy; otherwise, coverage is limited to permanent employees.

If the insured continues to employ the individual after discovering fraud, future losses related to that employee are not covered.

Any recoveries made from the fraudulent employee after the claim is settled may reduce the amount payable by the insurer or be reimbursed to the insurer.

Unexplained stock shortages are generally not covered unless there is evidence of employee fraud.

Investigation costs are typically excluded, but some policies offer add-ons to cover these expenses.

If the employee’s duties change without notifying the insurer, coverage for that employee may be voided.

If the actual number of employees exceeds the declared number, the insurer’s liability may be reduced proportionately.

Yes, if specified in the policy, employees handling third-party goods or funds can be covered.

Yes, additional employees can be added during the policy term, usually by endorsement and paying an additional premium.

Yes, if the whistleblower’s report leads to the discovery of fraud, it may be covered within the policy terms.

Yes, mid-term adjustments can be requested, subject to the insurer’s approval and possible premium adjustments.

Delays in notification may affect the validity of the claim, especially if the delay hinders the insurer’s ability to investigate the fraud.

Yes, as long as the fraud is discovered within the policy’s discovery period.

The insured must notify the insurer immediately, take steps to prevent further loss, and file a police report if required.

Yes, deliberate misappropriation of funds by employees is covered under Employee Fidelity Guarantee Insurance.

Acceptable evidence includes financial records, internal investigation reports, and witness statements, among other forms of proof.

The insurer uses the actual cash value of stolen items or funds at the time of loss to determine the payout.

Yes, failure to disclose material facts at the time of policy inception can lead to the policy being voided.

Yes, if specified in the policy, goods stolen during transit by an employee can be covered.

Claims filed after the policy’s expiration are only covered if the loss is discovered within the policy’s discovery period.