Fidelity Bonds (Crime Coverage)

A fidelity bond is a type of financial instrument that guarantees the performance of a fiduciary, who may be in a position of public or private trust relative to money.

Another term for fidelity bond is crime coverage, as it insures against money being taken from a company both within and from outside the organization.

Fidelity or crime coverage includes:

• Employee Dishonesty
• Forgery
• Check Alteration
• Wire Transfer Fraud
• Other External Threats

If you have a 401k plan you probably also have ERISA coverage, a subset of fidelity and employee dishonesty protection.

One way to take advantage of underwriting expertise is to use the carrier’s questions on a Crime application as a starting point for putting together your financial protocol.

Important update:  Cyber crime has surpassed the traditional check writing scheme by a wide margin over the past few years. “Social engineering” refers to today’s version of an old-fashioned grift.  Criminal digital theft is the fastest growing criminal enterprise in the world, so having dual authorization for funds transfer, and being highly aware – at all levels of the organization – of efforts to part a business from its money is more important today that ever.  A robust employee training program in coordination with your IT partners should be a critical part of any company’s strategy.