Employee Dishonesty Bonds
Employee Dishonesty for Investment Advisors and other
Financial Professionals may be written on a standard Employee Dishonesty Policy,
or a specific Industry Form (14 or 15). The difference between Employee
Dishonesty coverage for Investment Professionals from standard Employee
Dishonesty is the inclusion of coverage for the acceptance, and action on,
client investments where the client investment is fraudulent.
Some Broker Dealers and other Institutions may require their representatives to maintain Form 14 Bond.
There are two Employee Dishonesty Bonds for financial institutions distinguished by class of business:
Financial Institute Bond Form 14
- Investment Advisors
- Investment Consultants
- ERISA Plan Consultants
- Trustees
- Broker/Dealers
- Pension Consultants
- Litigation Consultants
- Actuaries
Financial Institute Bond Form 15
- Finance Companies
- Small loan Companies
- Mortgage Brokers
- Title Insurance Companies
- Holding Companies
- Real Estate Investment Trusts
Each bond provides coverage for loss of property that is caused by the dishonesty of employees and crimes of others (non-employees).
The bond is broken down into six assuring agreements:
Insuring Agreement A- Fidelity
Coverage is provided for loss involving any dishonest or fraudulent act of any employee. Such loss is covered no matter where it is committed and whether it occurs alone or in collusion.
Insuring Agreement B- On Premises
Agreement B responds to loss that occurs on an insured’s premises, from robbery, burglary, larceny, theft, false pretenses, misplacement or mysterious disappearance, damage or destruction.
Insuring Agreement C- In transit
This coverage is similar to Insuring Agreement B while the property is in transit, custody of a messenger or armored car.
Insuring agreement D-Forgery or Alteration, Optional coverage
This optional provision covers loss resulting from forgery or alteration of any negotiable instrument, except registered or bearer bonds.
Insuring agreement E- Securities Optional Coverage
This provision handles a loss that occurs because in good faith, the insured for his or her own account, or others has acquired, sold or delivered, or has given value extended credit or assumed liability on the faith of an original; certified security; document of title; deed, mortgage or other instrument conveying title to, or creating or discharging a lien on real property ; certificate of origin or title; evidence of debt; corporate, partnership or personal guarantee; security agreement; based on the forged signature of any maker, drawer, issuer, endorser, assignor, lessee, transfer agent, register, acceptor, guarantor; or that has been altered; or lost or stolen.
Insuring Agreement F- Counterfeit Currency
This agreement provides coverage for loss that results from the insured’s receiving counterfeit money of the United States, Canada or any other country where the insured maintains a branch.
Applications & Forms:
Philadelphia Insurance Company - Employee Dishonesty (non-form 14 or 15)
New Business Application (for firms requesting limits less than $1MM)
New Business Application (for firms requesting limits over $1MM)
Philadelphia Policy Comparison
The Hartford
