Employee Dishonesty- Commercial Crime Coverages

How do I protect my business from employee dishonesty? What about theft of money by others? If a computer is used to fraudulently transfer money from my bank account, am I covered? Below are basic explainations of available coverages.

The basic ISO Commercial Crime Coverages are as follows:

1.  Employee Theft - loss of money, securities or other property resulting directly from theft committed by an employee

2. Forgery or Alteration - loss from forgery or alteration of checks, drafts, promissory notes...that are made or drawn on your account by someone acting as your agent.  This protects against forgery losses caused by a person other than an employee.

3. Inside the Premises - Theft of Money and Securities - covers loss of your money and securities by theft, disapearance or destruction and damage to your premises or building and damage to a locked safe, vault, cash register, box or drawer from an actual or attempted theft or unlawful entry. This coverage protects against theft and damages caused by a person other than an employee.  

4. Inside the Premises - Robbery or Safe Burglary of Other Property - covers robbery of a custodian or safe burglary and damage to the premises or building or safe of "other property" that is other than Money and Securities. This protects from loss again by those other than your employees.

5. Outside the Premises - loss of money and securities or other property, outside the premises, in the care and custody of a messenger or an armored car resulting from theft, disappearance or destruction.

6. Computer Fraud - loss of or damage to money, securities and other proeperty resulting directly form the use of any computer to fraudently cause a transfer of that property from inside the premises or banking permises to a person or a place outside the premises.

7. Money Orders and Conterfeit Paper - loss resulting from your having accepted in good faith, in exchange for merchandise, money or services: 1. money orders that are not paid upon presentation or 2. counterfeit paper currency that is acquired during the regular course of business.

Other coverages available by endorsement:

8. Clients' Property - theft of your clients money, securities or other property by one of your employees

9. Funds Transfer Fraud - loss of funds by a "fraudulent instruction" directing a financial institution to transfer, pay or deliver funds from your account. This includes electronic, cable, fax or telephone instructions or written instructions fraudulently proprtting to be you but which was in fact fraudently transmitted by someone else without your knowledge or consent.

10. Extortion - Commercial Entities; loss through the surrender of money, securities or other property as a result of a threat communicated to you:  a.) to do bodily harm to a director, trustee, partner, member, manager, employee or proprietor or a relative or invitee of these persons, who was captured within the covered territory; or b.) to do damage to the permises or property inside the premises.