Blais Excess& Surplus Agency of Texas, LTD.

Crime Insurance protects the corporate balance sheet against dishonest acts such as theft, larceny, embezzlement, misappropriation, computer fraud, forgery and payroll impropriety caused by employees and third parties. It should be noted that mergers, acquisitions, downsizing, restructuring, expansion, computerization and globalization have all increased a company’s crime exposure index and the need to maintain a system of checks and balances. The Association of Certified Fraud Examiners (ACFE) in its 2002 Report to the Nation on Occupational Fraud and Abuse, estimates that fraud costs U.S. businesses more than $600 billion annually. The report also noted the following statistics:

More than half of the frauds in the study caused losses of at least $100,000, and nearly one in six caused losses in excess of $1 million;
63% of fraud schemes were perpetrated for more than 12 months before detection, with more than 49% lasting two years or more;
Employee fraud and abuse accounts for about 6% of total annual revenue, or about $4,500 per employee;

There are a number of policy forms with comprehensive insuring agreements that cover both the standard fidelity perils as well as loss of corporate assets resulting from other criminal activity. Highlighted below are a few of the standard features of a broad form of protection (These provisions are often times provided under the heading Coverage Clause A, B, C, etc. ):

Employee Theft Coverage: This provision provides insurance for losses of money or securities that have been embezzled by an employee through acts of theft or forgery.
Premises Coverage: A policy provision that insures losses of money or securities that are unlawfully taken, destroyed, or disappear from a customer’s premises. It should be noted that this provision often times extends to property lost in a robbery or safe burglary that occurs on the premises.
Transit Coverage: A provision that insures money or securities that are unlawfully taken, destroyed, or disappear while being transported. The provision is often extended to apply to loss of property due to a robbery that occurs during transit.
Forgery Coverage: This provision protects an insured company from losses resulting from forgery or alteration of a financial instrument, such as a check or draft issued by the insured company.
Computer Fraud: A provision of coverage that protects a company’s assets from loss of money, securities or property such as inventory, at the hands of a hacker.
Funds Transfer: This provision provides coverage in the event a financial institution transfers money or securities based on fraudulent documentation purported to have been sent by an insured company.

Additional coverage features that can be included: Broad form definition of Employee and Claim, Consolidation/merger wording, Client coverage, Credit Card fraud, Money Order and Counterfeit currency coverage, Investigative cost coverage and the expansion of the definition of territory. Blais Excess & Surplus can tailor crime coverage to meet the needs of any insured through attachment of wide variety of riders.