& CRIME INSURANCE
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
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.
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
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
* 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.
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.
Crime insurance is designed to protect businesses and government
entities against property loss resulting from crimes such
as burglary, robbery, theft, and employee dishonesty.
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.
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.
more details, please call a PaulBalep Representative toll-free 1-800-964-8614 to receive a free, no-obligation