Dishonesty Bonds Overview
Owning a business usually involves hiring employees. While we all intend to hire trustworthy employees, fraud and theft can happen. When it does, dishonesty bonds protect employers against losses due to employee dishonesty.
What Dishonesty Bonds Do
An employee dishonesty bond, sometimes called a crime bond, is a surety bond that can be purchased by employers as a guarantee that money, securities and property lost due to employee dishonesty can be replaced.
There are three types of employee dishonesty bonds:
Blanket Position Bond
- Blanket bonds provide coverage for all employees who are regularly employed by the employer during the term of the bond.
- The bond is issued for a fixed amount and each employee can be covered up to the full amount, meaning that the maximum amount payable for one act would be the amount of the bond multiplied by the number of employees involved.
Position Schedule Bond
- Position schedule bonds typically cover employees based on their position or job title.
- Each position is covered for a designated amount for the length of the bond term.
Name Schedule Bond
- Name schedule bonds offer coverage for a specific list of employees during the term of the bond.
- Each employee is bonded separately and each to a named amount.
Considerations for Dishonesty Bonds
If you’re considering a dishonesty bond for your business, remember to keep the following in mind.
- What are the roles of your employees? To what does each have access?
- What vulnerabilities does your business have?
- Do you have specific employees who have created problems in the past, or you’re not sure you can trust?
Remember that without a dishonesty bond, even if the employee at fault ends up behind bars, your business may not be reimbursed for what was stolen. Depending on what was stolen, your business could face financial hardship, lose clients, have to halt operations, or shut down completely.
How to Get Started
In addition to helping you understand how bonds and insurance can protect your business, the bonding and insurance professionals at Fusco & Orsini want to help you find plans that fit your needs and your budget. Request a free quote.