FIDELITY INSURANCE

 

FIDELITY INSURANCE

Honesty & Integrity are essential elements in the employee portfolio. Any risk from that quarter can lead to a loss financially and affects the goodwill/brand image of the business.

A committed employee is a greatest asset to the organisation through his honest contribution in the everyday business processes. Likewise a dishonest employee leaves a sour trail that jolts the operations .A Fidelity Guarantee policy is the safest policy to cover such losses.

There are three parties to the contract:

Insured (usually employer),

Employee

Insurer

WHAT IS THE COVER?

Normally Fidelity Guarantee cover is taken for cashiers, godown keepers and accountants etc. who have fiduciary relationship and access to money or stocks of employer.

Fidelity Guarantee policy indemnifies employers against financial loss on account of forgery, defalcation, embezzlement and fraudulent alteration/conversion by employees.

Such dishonest acts causing loss detected within 12 months of employee leaving the organization or his dismissal /termination or other removal only are admissible and not later on.

Once an Employee becomes delinquent, he is uninsurable forever thereafter.

           IMPORTANT FEATURES

Ø  The cover is granted against a direct loss and not a consequential loss.

Ø  The loss should be in respect of money/securities or goods of the insured.

Ø  The act should be committed in the course of the duties specified.

Ø  If the employee guaranteed had left the services and the employer re-engaged him, no liability attaches unless the consent of the insurers was obtained.

Ø  The loss must be supported by evidence of the specified acts of dishonesty.

          SUM INSURED: Basis of SI is the amount handled by the employee, employees in a specific position

          POLICY PERIOD: One Year

          PERIOD OF DISCOVERY

Act of fraud/dishonesty committed on or after the date of commencement of this policy and during uninterrupted service with the Insured and discovered during the continuance of this policy or within twelve calendar months of the expiration thereof and  in the case of death, dismissal or retirement of the Employee with twelve calendar months of such death, dismissal or retirement whichever of these events shall first happen

 

TYPES OF POLICIES

•        INDIVIDUAL – (Named employee/position wise Sum insured)

•        COLLECTIVE (Employee-wise sum insured)

•        FLOATING POLICY- Single Sum insured for group of persons of same cadre, e.g. all cashiers or all clerks in an organization.

CONTROLS BY THE EMPLOYER:

•        Employer has to ensure that all checks and controls are in place and supervision over the

              employee is exercised.

•        Maintenance of Proper Accounting System.

•        Immediate notice to insurer on discovery of the insured act.

•        Within reasonable time (generally 3 months) provide complete details of the claim with proof of fraudulent activity.

•        When loss is made good, policy to be delivered to insurer for cancellation in case of individual policy and in case of group policy, cover will cease to the defaulting employee.

•        Insurer reserves the right of prosecution of the employee bearing the expenses.

CONCLUSION:

Persons in important or sensitive positions in the Organization especially cash handling , are high risk from the management perspective. A proper insurance policy will ensure minimal loss in the event of fraud or criminal activities by employees.

Covers can be customized to include specific requirements.

We at Zen Insurance  assist in choosing the right Insurance cover to suit your needs . Please contact us for assistance.

Disclaimer:

Zen Insurance is an IRDAI registered broker which facilitates quick & accurate insurance broking services. We deal with only regulator approved products of insurers. We do not underwrite the products.