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All the foregoing kinds of insurance have long been considered as insurance contracts designed to protect against loss in the particular field of crime to which they apply. Sales have been directed along the lines of a particular form of burglary policy which may or may not cover all of the kinds of crime losses within the field commonly known as burglary insurance. The sale of forgery coverages is not necessarily tied in with burglary insurance nor with the fidelity bonds. In consequence, an insured under one form may be shown to have a serious gap in protection when a loss arises from a type of crime against which he has no protection and which may not have been brought to his attention. Perhaps one reason for this situation is the division in the industry between burglary forms under the jurisdiction of one national rating organization and fidelity and forgery forms under a different national organization, each having its own separate manual of rates and rules. The effect is a separate departmentalization of each field tending to keep it separate in the eyes of producers and underwriters alike, whereas the policyholders’ interests might be better served by treating crime perils as a single unit with permissible variations within the crime insurance field.

Within the burglary field itself, combination policies are now issued in which interior, payroll and messenger robbery, and mercantile safe burglary are provided in one policy on an optional schedule basis as respects each type of coverage. If open stock burglary insurance is wanted, however, a separate policy is generally necessary causing possible problems in distribution of premises damage claims over the several policies.

A major forward step was made in combining burglary, fidelity, and forgery coverages in a single policy called a comprehensive dishonesty, disappearance, and destruction policy, commonly referred to as the C-3D policy. While this policy makes available a single form to cover these several crime perils, it remains a schedule of separate coverages, each subject to rates and rules applicable to the separate equivalent contracts.

The C-3D policy has five basic insuring agreements which may be described briefly as follows:

* Agreement I ( Commercial Blanket Bond). This agreement covers loss caused by dishonesty of officers and employees. There are two options. Option A is the same as a commercial blanket bond while option B is the same as a blanket position bond.

* Agreement II (Broad Form Money and Securities Policy-On Premises Coverage). Coverage under this agreement is for loss of money and securities from the insured’s premises, any banking premises, or similar recognized places of safe deposit, caused by destruction, disappearance, or wrongful abstraction. Merchandise is covered against safe burglary and robbery. Employee dishonesty, forgery, and voluntary surrender of property in any exchange or purchase is excluded.

* Agreement III (Broad Form Money and Securities Policy-Outside Premises Coverage. This agreement provides the same coverage as Agreement II but off the premises while property is being conveyed by the insured’s messengers.

* Agreement IV covers loss through acceptance of money orders (in exchange for merchandise, money or services) if not paid by the issuer on presentation; also, loss from counterfeit United States or Canadian paper currency.

* Agreement V (Depositor’s Forgery Bond). Protection is given to the named insured and his depository bank against forgery and alteration of the insured’s own commercial paper subject to the limitations previously noted in connection with the depositor’s forgery bond.

Other agreements may be added by endorsement as follows:

* Agreement VI - Incoming Check Forgery * Agreement VII - Open Stock Burglary * Agreement VIII - Paymaster Robbery * Agreement IX - Broad Form Payroll * Agreement X - Broad Form Payroll Inside the Premises Only * Agreement XI - Burglary and Theft on Merchandise * Agreement XII - Warehouse Receipts Forgery * Agreement XIII - Securities of Lessees of Safe Deposit Boxes * Agreement XIV - Burglary Coverage on Office Equipment * Agreement XV - Theft Coverage on Office Equipment * Agreement XVI - Paymaster Robbery Inside the Premises Only * Agreement XVII - Credit Card Forgery.

Commercial Crime insurance is designed to protect businesses and government entities against property loss resulting from crimes such as burglary, robbery, theft, and employee dishonesty.

A bond is a guarantee that a specific duty will be discharged, a certain performance maintained or a specific obligation fulfilled. Fidelity bonds guarantee an employee’s honest discharge of duty and are written to protect an insured from dishonest acts by employees. The Employee Dishonesty coverage provides coverage comparable to that provided by Fidelity bonds. There is another type of bond, called a Surety bond.

Please note that the precise coverage afforded is subject to the terms, conditions, and exclusions of the policy as issued. This explanation is intended only as a guideline. This information is not intended to be considered investment, tax or legal advice. It is provided, for your education only. This is not an insurance contract. All terms and coverages are defined solely by your policy.

For more details, please call a PaulBalep Representative toll-free 1-800-964-8614 to receive a free, no-obligation quote.



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