What is Fidelity Insurance?
Fidelity Insurance, which is also called a Fidelity Bond Insurance or Fidelity Guarantee insurance, is a type of insurance for your businesses to protect it in case their employees end up causing any losses due to things like dishonesty, theft or fraud. Even if such employees are a tiny minority, their acts can lead to a huge loss for your business.
Let’s look at an example, if you have a window repair business, and a worker was sent to a customer’s home but ends up stealing some of their jewelry, your company might be liable for this employee’s actions. Or, if after an employee leaves, you find out that they were using company credit cards to buy clothes online.
Having a fidelity insurance can protect you and your business against such circumstances, however rare they may be.
Why do you need a Fidelity Insurance cover?
What does a Fidelity Insurance cover?
Getting a Fidelity Insurance, will protect your business in case of...
What’s not covered?
Since we believe in transparency, here are some situations that won’t be covered.
What are the advantages of having a Fidelity Insurance?
What are the types of Fidelity Insurance?
Since getting fidelity insurance is a great way to manage the risk to your business, you should keep a lookout for the type of plan that will work best for you and your business. Generally, there are four types of fidelity insurance plans:
- Individual Policies – this type of plan will cover any losses due to the fraud or dishonesty of an individual employee.
- Collective Policies – under this policy, you will be covered against any fraudulent acts by a group of employees (and you can choose the amount of the guarantee based on the employee’s responsibilities and positions).
- Floater Policies – this is similar to the collective policy as it also covers a group of employees, but here a single guarantee amount is applied across the group
- Blanket Policies – these types of plans will cover all the employees of the organization.
- First-Party Coverage – this kind of plan will cover any losses to your own business due to Losses any wrongful activities by your employees.
- Third-Party Coverage – this covers any claims made by the customers or clients of your company against any dishonest acts by your business’ employees.
Types of Businesses that need Fidelity Insurance
Any organization that employs people can never ensure that all of them will be completely honest all the time. That’s why getting a fidelity insurance might be a good idea for your business, especially if:
How much will a Fidelity Insurance Cost?
Your Fidelity Insurance premium is usually about 0.5- 2% of the total coverage or sum insured of the policy. There are a lot of other relevant factors that go into calculating fidelity premiums, such as:
- The number of employees.
- The specific type of work they perform and their responsibilities.
- The maximum amount of funds or assets handled by the employees.
- The safety and security measures your business takes against cases of fraud.
- The past claims made against your business’s employees.
How to choose the right Fidelity Insurance policy?
Things to remember before getting a Workmen Compensation Insurance Policy
- Make sure your business has lots of safety and security measures. For any business that has a lot of tangible assets, it can be very important that you do everything you can to protect them, like locked doors, an on-site safe, and security cameras or security guards.
- Always conduct background checks on your employees. Before hiring any employees, especially those with a greater number of responsibilities and accesses make sure to check that they don’t have a criminal past.
- Monitor your receipts, sales and inventory regularly. Check all receipts against sales amounts, and money deposited regularly so that you can flag and discrepancies when it comes to missing or damages money or property early on.
- Check what is and is not covered under your fidelity insurance. For example, some standard policies may not cover data theft or computer hacking and fraud, so, read through the terms and conditions and you won’t be surprised by anything later.
- Evaluate all the factors together. Consider the risks posed as well as the number of employees as well as the sum insured and the premium to find the policy that gives you the best value.