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.


Ø  The maximum loss payable is limited to the specified limit for that employee.

Ø  The policy covers any financial loss arising out of dishonesty or any fraudulent act committed by the employee.

Ø  The employer can choose any of the following four categories of policies:

ü  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.

ü  Position Policy

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.

ü  Individual Policy

This policy provides for only one individual.

ü  Collective Policy

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:

v  In the event that the employee's terms of engagement are altered and the employee is not aware of the change.

v  Losses which may affect the risk at the time of effecting the policy due to thes uppression of facts

v  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

v  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


The customer must complete the proposal form and ensure that all the information as are required for proper underwriting is given.


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.


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