While cyber crimes make all the top headlines, physical crimes perpetrated by employees seem to be flying under the radar.

This is particularly worrisome for smaller operations as dishonest employees with criminal intent to steal money or inventory could make or break a business.

While businesses shouldn’t underestimate the harmful ramifications of a cyber breach, non-physical crimes have not usurped physical ones.

Consider a recent example of a Newfoundland minor hockey association now $80,000 in the red after a former treasurer allegedly stole money between 2017 and 2019. That money is owed to the city and for kids to continue to practice hockey at the local civic centre, their parents have to foot the bill.

And crimes like that can make or break a business, especially smaller operations.

If your business relies on employees handling cash or inventory, your goods and daily earnings are vulnerable.

Crime coverage is offered as part of CHES Special Risk’s commercial combined Property Policy but businesses don’t ask for it as much as they should. Even though this coverage is relatively inexpensive, businesses are simply less aware of internal crime risks.

One of the issues is that a large part of employee theft goes unnoticed because it is not done in one big swoop but over a longer period of time. And by the time it comes to the business owner’s attention it’s too late — the money is gone and businesses are on the hook for the perpetrator’s crimes.

In times where business owners are encouraged to delegate responsibilities to grow, they might inadvertently be delegating to dishonest employees and threatening a lifetime of work in the process.

To find out more about Crime coverage or how a CHES Special Risk policy can better respond to your Clients needs, please speak to your CHES underwriter or email us at quotemehappytoronto@chesspecialrisk.ca.

FAQ

What types of crimes are typically covered by crime coverage insurance?
What types of crimes are typically covered by crime coverage insurance?

Crime coverage insurance is a type of insurance that protects businesses from financial loss due to certain criminal activities. The types of crimes typically covered by this insurance include theft, forgery, embezzlement, and fraud. Theft coverage is usually the most basic coverage provided, and it typically protects businesses from losses due to theft by someone outside of the company. Forgery coverage, on the other hand, protects businesses from losses due to the fraudulent use of a signature, while theft coverage protects businesses from losses due to the misappropriation of funds by an employee. Fraud coverage provides protection from losses due to deception, false statements, or misrepresentation.

Can crime coverage insurance protect against theft by employees?
Can crime coverage insurance protect against theft by employees?

Yes, crime coverage insurance can protect businesses from theft by employees. Theft coverage is designed specifically for this purpose. Embezzlement occurs when an employee misappropriates funds or property that they have been entrusted with. This can be a serious problem for businesses, as it can result in significant financial losses. Embezzlement coverage provides businesses with protection against this type of crime and can help them recover any losses they may have suffered.

Is crime coverage insurance required by law for businesses?
Is crime coverage insurance required by law for businesses?

No, crime coverage insurance is not required by law for businesses. However, many businesses choose to purchase this type of insurance as a way to protect themselves from financial loss due to criminal activities.

What should business owners look for when choosing a crime coverage insurance provider?
What should business owners look for when choosing a crime coverage insurance provider?

When choosing a crime coverage insurance provider, business owners should look for a provider that offers coverage that is tailored to their specific needs. They should also look for a provider with a strong reputation for customer service and claims handling. Additionally, business owners should compare pricing and coverage options from several providers to ensure they are getting the best deal.

Can crime coverage insurance be bundled with other types of business insurance?
Can crime coverage insurance be bundled with other types of business insurance?

Yes, crime coverage insurance can often be bundled with other types of business insurance. This is commonly done with commercial property insurance, general liability insurance, and other types of coverage.

Are there any exclusions to coverage under a crime coverage insurance policy?
Are there any exclusions to coverage under a crime coverage insurance policy?

Yes, there may be exclusions to coverage under a crime coverage insurance policy. For example, some policies may not cover losses due to dishonest or fraudulent acts committed by the business owner or other members of management. Other policies may have exclusions for losses due to cybercrime or other types of criminal activities.

Can a business still be held liable for a crime that occurs despite having crime coverage insurance?
Can a business still be held liable for a crime that occurs despite having crime coverage insurance?

Yes, a business can still be held liable for a crime that occurs despite having crime coverage insurance. Crime coverage insurance is designed to protect businesses from financial losses due to criminal activities, but it does not protect them from liability for those activities.

Is crime coverage insurance a worthwhile investment for small businesses?
Is crime coverage insurance a worthwhile investment for small businesses?

Yes, crime coverage insurance can be a worthwhile investment for small businesses. Small businesses are often more vulnerable to financial losses due to criminal activities, as they may not have the same level of security measures in place as larger businesses. Crime coverage insurance can help small businesses recover from losses due to theft, and other criminal activities.

What does crime coverage typically include?
What does crime coverage typically include?

Crime coverage typically includes coverage for theft, forgery, and fraud. It may also include coverage for computer fraud and extortion, as well as coverage for losses due to counterfeit currency.

How does crime coverage differ from general liability insurance?
How does crime coverage differ from general liability insurance?

Crime coverage and general liability insurance are two distinct insurance policies. General liability insurance covers third-party claims of property damage and bodily injury, while crime coverage protects against internal risks like employee theft, forgery, fraud, and embezzlement. General liability insurance doesn’t cover losses that result from criminal acts, so crime coverage is necessary to provide protection for internal risks.

Can crime coverage also protect a business from cybercrime?
Can crime coverage also protect a business from cybercrime?

Crime coverage provides limited protection against certain types of cyber risks, such as social engineering scams, but it’s not designed to provide comprehensive coverage for cybercrime. Businesses need a separate cyber liability insurance policy to fully protect against cyber risks like data breaches, ransomware attacks, and phishing scams.

How often should a business review its crime coverage policy?
How often should a business review its crime coverage policy?

Businesses should review their crime coverage policy annually or whenever significant changes to the business occur that could affect its risk profile, such as hiring new employees or implementing new financial procedures. Regular reviews can help identify any gaps in coverage and ensure adequate protection against internal risks.

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