Employees Required to Establish Employee Theft for Coverage under Crime Policies

Although no business wants to deal with the issue, companies are increasingly being forced to deal with losses from theft, fraud and embezzlement in the workplace. The losses in these situations can be enormous and companies are taking measures to protect their assets. Since first-party property policies typically do not cover crime-related losses, companies are purchasing Commercial Crime Policies, also called fidelity insurance, to fill this gap. Commercial Crime Policies provide employers with protection from losses that arise from employee dishonesty, forgery, and counterfeiting. While the language in crime policies varies by insurer, two examples of typical coverage grants are as follows:
 

The Company will pay the Insured for the Insured’s direct loss of, or direct loss from damage to, Money Securities and Other Property directly caused by Theft or Forgery committed by an Employee, whether identified or not, acting alone or in collusion with other persons.

The Company shall pay the Insured for direct loss of Money, Securities or Property sustained by an Insured resulting from Theft or Forgery committed by an Employee acting alone or in collusion with others.
 

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