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Fidelity Guarantee

Direct financial loss caused by the dishonesty of an employee: theft, embezzlement or fraudulent accounting.

Also calledFidelity Guarantee · Employee Dishonesty · Commercial Crime

File/Claims library/Financial lines/Theft and dishonesty

First thing, todaySuspend access, secure the records and the system logs, and notify the insurer before you confront the employee.

Three deadlines
  • Tell the insurer now, not after the assessment.
  • The FIR the same day. An insurer will not move far without it.
  • Every document within the time the insurer asks for it.
A ledger open at an account, one line ruled through
A ledger open at an account, one line ruled through. An illustration.

When you would claim

  • Cash or stock found missing on an internal check
  • Falsified accounts, invoices or vouchers discovered
  • An employee absconding with money or goods
  • A supplier or customer reporting payments that never arrived

What insurers most often rely on

  • The loss discovered outside the discovery period the policy allows
  • No proper system of checks, where the wording requires one
  • The loss quantified as a shortfall rather than traced to specific dishonest acts
  • The employee retained in service after an earlier known dishonesty
  • Consequential loss and investigation cost claimed where only the direct loss is covered

Each of those is a question about the record. The record answers it or it does not, and that is the whole of the argument.

The documents

it is an accounting file

10 items, and this is an accounting claim. What proves it is the record the loss ran through, not a description of the loss.

  • Claim form and the internal investigation report
  • The auditor's or accountant's report quantifying the loss
  • The falsified records themselves, preserved
  • System and access logs where the fraud went through the accounts
  • The employee's file, appointment letter and any admission
  • FIR or police complaint where lodged
  • Evidence of what has been recovered from the employee
  • Cancelled cheque and bank details in the insured's name, for the NEFT payment
  • Details of any other insurance covering the same risk
  • The quantified loss: the account, the period it ran over, and the entries that make it up
The discovery dateAlmost every financial-lines wording runs its time bar from the date of discovery rather than the date of loss. Write down when it was found, by whom, and what was done that day.

Next

Burglary Claim: The First 24 Hours, and what it shares with this

The burglary playbook covers the first night of this: the FIR the same day, and no tidying up before the surveyor has stood in the room.

Call 92514 56334

Read the limit of indemnity

No sum insured and no average clause. A liability policy is capped by its limit of indemnity, written as one figure for any one accident and a larger one for the year, with defence costs sometimes inside that limit and sometimes outside it. Which of the two it is matters more than the figure.

Filed under: Financial lines · Theft and dishonesty

Claims that sit next to this one

money, taken or owed

Money in Transit and in Safe

cash, however it leaves

Directors' and Officers' Liability

dishonesty higher up

Trade Credit

money owed rather than money taken

Been broken into and the list will not reconcile? Report a loss or call 92514 56334.