Fidelity has been defined with varying definitions across the board, but in its simplest terms, fidelity refers to faithfulness, truth and dedication in relationships, often in terms of intimate or romantic relationships; but it can refer to other sorts of relationships as well, including the relationship between an employer and employee. Infidelity is something that, as human beings, we would want to avoid against for the sake of our own well-being, yet is inevitable at times. When infidelity happens, you should be able to protect yourself against it, not only emotionally and psychologically, but practically and financially as well. A fidelity guarantee is a contract of insurance and a contract of guarantee to which the general principles of insurance apply. Of course, Fidelity Guarantee Insurance cannot guarantee that your employee will be faithful or honest, but it does guarantee that if you suffer any financial loss because of your employee, you can manage such risk legally, but within the set limits of the contract. Fidelity Guarantee Insurance is undertaken by the insurer to cover financial losses which have incurred as a result of an employee’s dishonesty and misuse of company's money, such as in the form of embezzlement, forgery, or fraud. If you are an employer, Fidelity Guarantee Insurance is something you should have in case employees stray from their commitment and loyalty to the organization, especially in terms of finances.
Extensions of Fidelity Guarantee Insurance Different types of extensions are offered with their basic cover and are as follows: icon-check-circle Auditor's fee - in which you can engage an auditor to authenticate the amount of loss to indemnify you for his fee, but it is still subject to approval by your insurer. icon-check-circle Automatic additions and deletions - whereby cover can be provided for additions and removal of employees that meet the classification in your policy. icon-check-circle Premium adjustment - this is based on the declared wage role or the number of employees during the duration of your policy and your insurer’s blanket policy which covers your employees can also be adjusted. Considerations of Fidelity Guarantee Insurance In order to gain benefit from Fidelity Guarantee Insurance, there are certain boundaries to consider:
The infidelity on part of your employee(s) should have been committed during the time period of your insurance.
The act should be an uninterrupted continuance of the employment of the defaulting employee(s).
You should notify your insurer within 12 months of the infidelity being committed by the employee(s).
The loss should be in respect of moneys or goods and the act should be committed in the course of the duties specified. If your employee(s) guaranteed under the policy has left the services of the employer and was re-engaged by him, no liability will be attached to the policy unless the consent of the insurers was obtained.
The loss would be payable if it was caused by inadequate accountancy on part of the company. It is essential that the loss can be evidenced (via objective evidence and documentation) that the infidelity was committed by your employee(s) deliberately.
Individual Policy: This covers an individual for a stated amount, which should be discovered and reported within 24 months.
Collective Policy: This covers a group of employees, in which the insurer decides the amount of guarantee required for each employee based on his/her responsibilities and position in the company.
Floating Policy: This is similar to the collective policy in that the individual employees are named, but only one amount of guarantee is given. This means that only one collective amount floats over all the employees covered and you are guaranteed the maximum amount for which your insurer holds liability. Floating policies are granted where the number of employees to be guaranteed is five or more.
Blanket Policy: The insurer, in certain selected cases, issues blanket policies without the names of the guaranteed persons being shown, in respect of all employees who are grouped according to categories. The amount covered could be in terms of “per employee” or based on the amount of loss that occurred.
Some of the exclusions of a Fidelity Guarantee Insurance policy include: icon-times-circleThe first loss that has been incurred as an excess to any other policy claim icon-times-circleA change in within the nature of the business that has been insured icon-times-circleLoss of interest and any other similar losses that bring about major consequences icon-times-circleChange in responsibilities or salary of the person concerned without it being sanctioned by the company or authority. icon-times-circleLack of proper procedures to secure and keep track of financial accounts icon-times-circleLoss in terms of any improper financial gain that has been received by the person concerned as part of their normal employment icon-times-circleShortage of finances due to errors in calculations or sudden losses and disappearances
What to do in the event of a Claim
If you are faced with the unfortunate circumstance of wrongful financial loss, there are important steps you should follow before filing a claim: icon-plus Immediately notify the police and take all the necessary steps to prosecute your employee(s) for the criminal acts which they have committed. icon-phone-square Notify your insurance adviser immediately about the situation, including the name of your employee(s), their whereabouts, and their criminal acts. icon-folder-open-o Complete the Fidelity Guarantee Claim Form together with full details, particulars, and evidence and any other information as may be required. icon-briefcaseTo the extent allowed by law, retain all monies and other assets which are due to your employee(s) who caused the loss.
Checklist of Documents required
• Duly completed fidelity guarantee claim form • Police report • Police investigation result • Internal investigation result • CCTV footage • Letter of employment/termination • Detailed description of the employee’s job duties • Duty roster of the employee(s) • Records supporting the amount claimed • Details of restitution made by the employee(s)
Making sure you have good insurance coverage and a good insurer is key to making sure that you are successful in your endeavours to file claims and be covered financially in order to avoid further loss, so you want to make sure you have the best one around! Let us help you work through your infidelity crisis for your peace of mind! We provide you with 24-hour around the clock services at your fingertips to help you save time by helping you to complete all your paperwork. We help you by providing the fastest and best claim support available, as well as advise on claim processes and contract matters by letting you speak to our best and most experienced consultants!
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