It’s uncommon anymore to hear stories about employees committing desperate acts against their company and even customers.
Scenarios like the following are becoming much more common:

• An employee steals inventory from the company and disappears.
• An employee uses the company credit card for personal purchases like a television, gas, clothes, etc.
• An employee skims money, taking thousands of dollars over a period of about a year.

You can actually purchase insurance coverage for these acts, but it must be done by adding Employee Dishonesty coverage to a Crime Policy.

The Coverage

Employee dishonesty insurance is coverage for just that: dishonest or criminal acts committed by employees.  It covers losses where an employee steals money, securities, or even tangible property.  Some policies will even cover the theft of clients’ belongings.

What is the typical limit?  Like always, this depends. Some companies are much more cash-heavy than others, and the risk is greater for this type of loss.   However, the typical limit is anywhere from $50,000 to $100,000 in coverage.

How much will this cost?  Depending upon the limit and type of business, premium starts at a couple of hundred dollars a year.  Premium is almost always based upon the number of employees within the company.

Any exclusions?

• Acts committed by an owner, officer, or director within the company.
• Inventory shortages where the sole proof of loss is an inventory computation.
• Any employee discovered to have a history of prior dishonest acts either before or after being employed by the insured.