Crime

1. Have someone other than the person responsible for reconciling the bank account make deposits, make withdrawals and sign checks; 
2. Have checks countersigned; 
3. Immediately stamp all incoming checks “for deposit only”; 
4. Segregate duties for inventory management, cash receipts, vendor approval, purchase order approval and payments, oversight of blank check stock, retail checks and credit card receipts; 
5. Require dual authorization of wire transfers. 

Of course, there are other recommendations that we would be glad to discuss you.

The most obvious method of transferring risk of loss would be in the form of a crime insurance policy. Crime policies, however, are a tricky thing to understand. The key here is to understand exactly what constitutes an occurrence. An occurrence is defined as all losses caused by, or involving, one or more employee(s). The result(s) of a single act or a series of acts is considered one occurrence, including and employee acting alone or in collusion with another. So, this means that a repeated event is a single act according to insurance. I recently witnessed a case where an employee stole more than $300,000 of brass and copper fittings and sold them as scrap for pennies on the dollar. Do you believe the employer was happy with his $5,000 coverage limit?

When purchasing crime coverage, there are many angles and coverage types that must be considered.  The offering of crime coverage is very broad and may be extended to include First and Third Party Employee Dishonest Acts,  Computer Crime, Funds Transfer Fraud, ERISA Fidelity, and Forgery & Alteration just to name a few.

So, just how expensive is this coverage? Well, that depends upon the security controls and processes you have in place to mitigate loss, but entry level premiums start as low as $800 per year with $250,000 of coverage.  If you are thinking that is a lot of money then just consider the financial impact a loss of $300,000 would have on your cash flow.  It is also important to remember that insurance underwriters make a judgment decision on the security controls during the application process. If you would like to obtain the best rate possible it would be helpful to have a discussion with one of our insurance representatives and put into place proper controls to aid in pricing.
Speak with a Rep Get a Quote