WHO IS IT FOR?
Employers often resort to this policy to cover the
breach of an employees fiduciary duty and the trust vested in the employee who
may be involved in the handling of cash and goods needed for the business.
The maximum loss payable is limited to the specified
limit for that employee.
The policy covers any financial loss arising out of
dishonesty or any fraudulent act committed by the employee.
The employer can choose any of the following four
categories of policies:
Floating Policy or Floater
Under this policy, the names and designation of the
group members is included in the policy schedule. This policy may be seen as an
extension of collective policy where the sum insured is specified for the whole
group rather than for each individual. The sum insured is reduced as each claim
is made and an extra premium is needed to reinstate the cover.
Under this policy, the liability is limited to the
amount of sum insured and does not take cognizance of the number of people
working in Instead of names and designation of individuals, the policy schedule
contains positions with the corresponding insured sum alongside.
This policy provides for only one individual.
This policy covers entire staff or number of selected
people but does not pay more than one claim in respect of liability or loss
arising out of an ascot of a single employee. The policy is issued and must
show the employee's names and the respective limits imposed. What the policy
does not cover The policy excludes the following losses:
In the event that the employee's terms of engagement
are altered and the employee is not aware of the change.
Losses which may affect the risk at the time of
effecting the policy due to thes uppression of facts
Losses resulting from a commitment made which had come
to the notice of the insured/ representatives of supervisor although it had
been made earlier to an act of dishonesty or fraud
Where there are multiple claims concerning a single
employee Where checks and precautions are not observed or unnecessarily
relaxed. Arising from non-observance or relaxation of checks and precautions
WHAT DO I DO?
The customer must complete the proposal form and
ensure that all the information as are required for proper underwriting is
WHAT IS THE PREMIUM?
Flexibility in rating may arise where experience
justifies it. Apart from the agreed rating pattern adopted by banks and related
institutions, the premium rate ranges from between1.5% and 2.5%, and is subject
to several factors such as the loss history or experience of the client or the
industry concerned, the aggregate exposure, occurrence.