Crime or Fidelity cover can be included as one section of a Management Liability policy.

The scope varies considerably between insurers, so the section should be checked rather than assumed to provide broad standalone Crime Insurance.

What can the section cover? #

Depending on the policy, cover can include certain direct financial losses arising from employee dishonesty, including:

• Theft of money.
• Theft of business property.
• Misappropriation of funds.
• Embezzlement.
• Fraudulent transactions.
• Forgery.
• Alteration of documents.

Does it cover fraud by people outside the business? #

Not necessarily.

Management Liability Crime sections vary in how they treat:

• External fraud.
• Social engineering.
• Fraudulent invoices.
• Impersonation scams.
• Funds transfer fraud.
• Cyber-enabled theft.

Some of these exposures can require a specific Crime extension, standalone Crime Insurance or Cyber Insurance.

What restrictions can apply? #

Depending on the policy:

• Owners or particular senior people may be treated differently.
• Known dishonest acts can be excluded.
• Losses continuing after dishonesty is discovered can be restricted.
• Accounting errors may not be covered.
• Indirect or consequential losses can be excluded.
• Certain cybercrime events may fall outside the section.

Is standalone Crime & Fidelity Insurance different? #

Potentially.

A standalone Commercial Crime policy can provide broader or differently structured protection than the Crime section within Management Liability.

The appropriate structure depends on the size of the business, controls, exposures and required limits.

Where can I read more? #

Our dedicated Crime & Fidelity Insurance articles explain employee fraud, external crime, social engineering, discovery periods, claims and quote requirements in more detail.