EMPLOYEE DISHONESTY COVERAGE

Few business owners like to hear this term.  They know and trust their employees, and they have controls in place so a loss could never happen to them.  But it can, and it does.

While most people think of loss of money, an employee dishonesty loss could also apply to securities and other property, including business contents and inventory.

Did you know that this type of loss can occur over a period of time – weeks, months or even years?  Employers find this hard to believe.  They are sure that they would notice any loss within a very short period of time.  However, while any one day may just be a few dollars or items, over a long period of time the loss can balloon well into the thousands and many times these acts are not discovered for months or years.

Controls are very important in deterring this type of loss.  These could include having both financial and inventory audits done regularly (annual, semi-annually or quarterly); having someone reconcile bank accounts who is not able to sign checks; having countersignatures required on all checks; having securities subject to joint control of two or more responsible employees; and requiring officers and employees to take annual vacations of at least five consecutive business days.

Benefit packages to employees can also be a deterrent from fraudulent acts.  Do you provide health & dental insurance?  Do you provide paid vacations?  Do you provide other benefits or perks that will let your employees know they are appreciated and valued?  All of these things can help prevent a loss.

However, even with the best controls in place and the most trusted people employed, an employee may not be stopped from engaging in a fraudulent act.  Are you protected?

Employee Dishonesty coverage can be written in two ways – Blanket coverage can apply to all employees; Scheduled coverage can be written for specific named employees, or specific named positions within your company. 

Many times this coverage can be easily added to a Business Owner’s or Commercial Package Policy.  If not, a separate Fidelity Bond can be written to provide the coverage you need.  Review your situation and practices.  For more information, talk to your insurance agent. 

Do not hesitate to call on us if we can be of any assistance.

Heil & Heil Insurance Agency LLC

Commercial Insurance Department

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Quality of lifestyle can be preserved by managing risk. Let us help you manage yours!

Heil & Heil Insurance LLC