Employee Dishonesty Insurance

EmbezzlementDo you have employee dishonesty insurance? This is an additional rider available for most business insurance policies. The average cost is around $125 per year.  Often, you must buy another rider that extends the coverage to theft of your clients’ property by your employee. In other words, the employee doesn’t steal your money, they steal the property owner’s money.

According to estimates I’ve seen, theft costs businesses over $400 BILLION a year. Those same sources estimate that 80% of all theft is caused by employees!

There are some requirements to making a claim. You have to be willing to press criminal charges against the employee.  Usually, employees must pass a background check and are not eligible if they have prior felony convictions.

Many civic and charitable organizations should also check into getting this insurance. Such organizations are usually far more lax about their accounting and supervision than most businesses, and often suffer serious losses from embezzlement as a result.

Please talk to your insurance agent about this issue.  Property managers, you need to especially ask about any difference in coverage if the employee steals your money, or your clients’ money.