Employee arrested for fraud.

What does crime and fidelity insurance cover for law firms?

Crime and Fidelity Insurance protects law firms from loss of money, securities, or inventory resulting from the crime. Common insurance claims allege employee dishonesty, embezzlement, forgery, robbery, safe burglary, computer fraud, wire transfer fraud, counterfeiting, and other criminal acts.

These schemes involve every possible angle, taking advantage of any potential weakness in your law firm’s financial controls. From fictitious employees, dummy accounts payable, non-existent suppliers to outright theft of money, securities, and property. Fraud and embezzlement in the workplace are on the rise, occurring in even the best work environments.

Any employer that needs to be concerned with Employee Dishonesty or any business handing cash or securities needs protection from robbery or theft will need Fidelity/Crime Insurance.

Because most property insurance policies do not typically cover crime-related losses, crime protection insurance is a necessary component for any business. Unfortunately, the majority of firms don’t purchase enough crime protection.

According to a recent study by the Association of Certified Fraud Examiners (ACFE). It estimates the average business is losing six percent of its total annual revenue from losses involving employees — on average more than $9 per day per employee.

To find out more about how crime insurance can protect your law firm, please contact our office.

Employee forging a business document.

What is employee dishonesty insurance coverage?

Employee dishonesty insurance can be one of the most important coverages firms can purchase. Why? Fraud and embezzlement instigated by employees are on the rise in the small business workplace. According, Small businesses are especially vulnerable, especially those who cannot absorb large losses or cannot afford extensive precautions and safeguards.

Employee dishonesty insurance coverage sometimes referred to as fidelity bond, crime coverage, or crime fidelity insurance, is a type of business insurance that protects a small business employer from a financial loss due to fraudulent acts conducted by an employee group. The financial loss can be caused by an employee’s theft of property, money, or securities owned by a small business.


Stand-alone employee dishonesty  coverage policies are designed to cover forgery, alteration, unauthorized electronic funds transfers, credit card fraud, computer fraud, money order fraud, and counterfeit fraud. These business insurance crime coverage policies not only protect the small business owner, but employees defined in the policy, such as current or former employees, trustees, members, partners, directors, temporary employees, and seasonal employees, may also be protected.


Endorsements can also be added to employee dishonesty insurance coverage policies. For example, a third-party endorsement can be added, extending coverage to a client that you’re performing services for under a written contract. Under this endorsement, the policy will compensate for damage or loss to the property, money, or securities leased or owned by a client due to theft by your employee. Basically, this third-party endorsement modifies the employee dishonesty policy to include client premises coverage. An endorsement can also be added to cover an Employee Retirement Income Security (ERISA) bond.


Some typical exclusions in an employee dishonesty insurance policy include math errors or omissions, accounting errors and omissions, vandalism, government seizure or destruction of business property, profit and loss restatement, theft by the policyholder, and loss of income that would have been realized without damage or loss to property, money, or security.