Employee Theft Risks and Crime Insurance
Employee theft is a common concern for family offices, wealth advisors, business owners, and successful families and individuals. Crime insurance helps to ensure that you and your business are properly protected from these employee theft risks.
What are some examples of employee theft?
- Maintaining two sets of accounting records
- Invoices paid to companies that don’t exist, and then cashing the checks
- Increasing check and invoice amounts after they have been paid
- Artificially increasing payroll and cash expenditures
- Removing ledger sheets to hide shortages
- Charging inactive accounts
- Stealing cash, merchandise, or materials
What are my options to combat employee theft?
1. Employee Theft Coverage
Employee theft coverage provides coverage for your money and business from theft, inside and outside your organization.
2. Robbery and Safe Burglary Coverage
This coverage protects against money loss on premises or in the custody of an employee off premises.
3. Theft Disappearance and Destruction
This protection covers money or securities loss from theft, disappearance, or destruction while the property is on premises. Furthermore, it also protects against attempted or actual robberies.
4. Computer and Funds Transfer Fraud Coverage
Computer and funds transfer fraud coverage is a vital coverage as wire transfers are commonplace within daily operations at many organizations. This coverage provides protection against loss of money by computer fraud. Additionally, it pays for the loss of money through fund transfers communicated to a bank or financial institution.
5. Cyber Liability
Cyber liability coverage protects individuals and businesses. This protection covers a business or individual’s liability due to data breaches where personal information is exposed or stolen by hackers or criminals.
What other safeguards can prevent employee theft?
- Separate accounting and operation functions
- Limit and control access to storage or sensitive security areas on premises
- Limit and control access to electronic client documentation or sensitive personal information
- Establish appropriate lines of authority and ensure that all employees are acting responsibly
- Create a “paper trail” for transactions and audit those transactions
Crime insurance is a vital investment for anyone who hires employees, whether as an individual, family office, corporation, or small business. If you are interested in learning more, please contact our team at Sterling, who can help determine if crime insurance fits your customized insurance plan.