Employee Dishonesty Insurance

What Is Employee Dishonesty Insurance?

‘Employee Dishonesty Insurance’ is an insurance safeguard for employers against theft committed by their employees.

An Employee Dishonesty Insurance policy protects a business against financial impairments stemming from any criminal acts committed by an employee/employees like embezzlement, theft of money or securities.

Under such a situation, the insurance company indemnifies the insured for any loss which results directly from such criminal acts.

Employee theft is a significant concern for many employers. Therefore, it's crucial for all employers to comprehend this insurance coverage and its workings, ensuring they are prepared to utilize it if the situation demands.

In short, Employee Dishonesty Insurance is an insurance that:

1. Provides coverage for losses incurred due to deceitful actions by employees

2. Comes into effect when an employee steals money, or other assets from their employer.

What is covered in Employee Dishonesty Insurance?

1. Legal fee

   Costs, legal fee and expenses incurred by the Insured towards Defence of any demand, claim, suit or legal proceeding which the insured has to establish arising directly from a loss covered under the policy conditions

2. Care, custody and Control

   Any loss of Property, Money or Securities under the control and custody of an Insured incurred due to a fraudulent act will be covered for by the insurance company

3. Court Attendance Costs

   For instances where the insured is legally compelled to attend a civil proceeding as a witness in a claim, Court Attendance Costs will be covered by the insurer

4. Credit Card Fraud

   Loss suffered by an Insured resulting from Credit Card Fraud committed by a Third Party is covered

5. Data Reconstitution Costs

   Cost of reconstituting data that is lost by the insured

6. Extortion Cost

7. Interest Covered

   Amount of any interest receivable or payable by the Insured resulting directly from the incident of loss

8. Loss Investigation Cover - Investigation Costs

9. New Subsidiaries

10. Theft of Money or Securities/ Embezzlement

    Covers reimbursement for your company in instances where employees steal money or securities, either through direct theft or unauthorized transactions

11. Forgery and Alteration

    Covers instances where an employee forges a check, draft, or promissory note for personal gain at the company's expense

What is not covered in Employee Dishonesty Insurance?

1. Intellectual property rights and Trade secrets

   Employee Dishonesty Insurance does not extend to protecting against the theft or infringement of intellectual property rights and trade secrets

2. Consequential loss

   It does not include consequential losses that arise as an indirect consequence of a covered event

3. Kidnap and Ransom

   Risks associated with kidnapping and ransom situations are not covered under Employee Dishonesty Insurance.

4. Trade finance and Trade loans

   Coverage for trade finance and trade loans are also not provided.

5. War

   Losses resulting from acts of war, terrorism, or geopolitical unrest are not covered under Employee Dishonesty Insurance.

6. Prior and pending acts

   Employee Dishonesty Insurance does not extend to covering losses that were discovered before or after the policy period.

7. Fire

   Employee Dishonesty Insurance does not cover property damage resulting from fire incidents/ other fire related losses

Some other named exclusions are listed below. Do keep in mind that these policies are highly customisable to a business. To understand the coverages and exclusions specific to your policy, refer to the policy document or contact the Plum team.

• Volunteers

• Business Interruption

• Unreported Crimes

• Employees with Criminal Histories

• Intentional Acts

How Much Does Employee Dishonesty Insurance Cost?

The cost of Employee Dishonesty Insurance is influenced by a multitude of factors, including the specifics of your business, your insurance requirements, and your industry.The size of your business is a critical factor.

The larger the number of employees, the higher the likelihood of one of them committing a crime against your business. Similarly, higher revenue implies more money at risk of theft, leading to higher insurance costs.

Insurance providers will also take into account your financial controls and security measures before providing a quote. Businesses with stringent protocols for handling money, deposits, checks, and transfers will likely pay less for crime insurance.

Plum understands the intricacies of Employee Dishonesty Insurance costs and business vulnerabilities. In order to simplify and make the process transparent, we have developed the Plum Business Policy Engine.

Our engine offers you valuable insights into policies suitable for businesses similar to yours, along with estimated expenses.

Employee Dishonesty Insurance Claims Process - How to raise a claim?

Following are the steps to file a Employee Dishonesty insurance claim;

1. Initiate contact on priority with the Plum team to report the incident.

2. Plum works promptly with the insurer partner and subsequent course of action is determined.

3. In collaboration with Plum and the insurers, an investigator is designated to assess the severity and analyse the details of the incident.

4. Expert guidance on containment measures to prevent the situation from worsening further is provided.

5. The Plum team aids you in comprehending the necessary documentation, which includes records on the extent of the impact, the actions taken for remediation, and any direct expenses incurred during the claims procedure.

6. Following an in-depth analysis of the documentation, the survey report is created.

7. Plum maintains a strong liaison with the insurer and policyholder throughout the claim approval process.