Theft by a stranger is a property claim. Theft by your own staff is not.
Property policies, equipment floaters and cyber wordings all step back when the person who took it worked for you. Employee dishonesty is its own policy, and the businesses most exposed to it are the ones that trust people, which is all of them.
Start a quote file Read the short answer firstStaff dishonesty sits outside property cover.
Most of it is found long after it starts.
The policy in force when you find it matters.
Does business insurance cover money or stock taken by an employee?
Not under a standard property policy, which excludes dishonest acts by your own employees, and not under an equipment floater, which excludes the same thing. It is answered by crime cover, sometimes called fidelity or employee dishonesty. That is a separate section you have to ask for, and a business can hold a full suite of commercial policies without holding it.
Owners tend to hear this and think it does not apply to them. The exposure is not created by having dishonest staff. It is created by having any staff at all who can move money, write off stock, set up a supplier or adjust a record without a second person seeing it. Small firms carry more of this risk than large ones, because one person often does all four.
An outside theft announces itself. A door is forced, stock is gone, and you know that morning. Employee theft is almost always small amounts repeated over a long period, hidden inside ordinary transactions that nobody has a reason to question. It surfaces when someone goes on leave, when a system changes, or when a new bookkeeper looks at something with fresh eyes. That delay is why crime policies are written around the date you discover the loss rather than the date it happened, and it is why the cover has to already be in place before you have any reason to suspect anything.
Four different losses, one section.
Money and securities
Cash taken from a till, a safe or a deposit run, on the premises and in transit. This is the oldest part of the cover and the part most businesses picture when they hear the word crime. It is rarely the largest part of a claim any more.
Employee dishonesty
Theft of money, stock or property by a person you employ. Wordings differ on who counts as an employee, and whether that definition reaches temporary staff, contractors and volunteers is worth checking against how you actually staff the business.
Forgery and alteration
Cheques or instruments altered or forged against your accounts. Quieter than it used to be and still live, particularly in businesses that pay by cheque or hold signing authority for clients.
Fraudulent instruction
Somebody outside the business convinces a member of your staff to send money, usually by impersonating a supplier or a director. This overlaps with cyber wordings and the two policies can both engage or neither can, which is exactly why the wordings should be read together rather than bought separately.
Three that were found by accident.
The bookkeeper who never took holidays
The most familiar pattern there is. One person controlled invoicing, payments and reconciliation, and never took more than a day off, because the arrangement only holds while nobody else does the job. It surfaced during a hospital stay. Requiring everyone to take a continuous block of leave is the cheapest control in this whole area.
The supplier who did not exist
A new vendor was set up, invoiced modestly and regularly, and was paid without question for a long time. Nothing was stolen from the premises, so property cover was never in the picture. Two-person approval on new vendor accounts would have stopped it on day one.
The stock that was written off
Damaged goods were being recorded as write-offs and leaving through the back door. Inventory shrinkage looked like ordinary wastage until someone compared write-off rates between shifts. Crime cover answered it, and only because it had been bought years earlier and never used.
The ones owners find uncomfortable and ask anyway.
We are a small team and I trust everyone. Do we need this?
Small teams carry more of this exposure, not less, because separation of duties is harder when three people do everything. The cover is generally modest for a small business. Whether to buy it is your decision, and it is a better decision made with the wording in front of you than made on the strength of how you feel about your staff.
Does it cover a contractor or a temp?
It depends entirely on how the wording defines an employee. Some extend to temporary staff, agency workers and volunteers; some do not. If a meaningful part of your workforce is not on payroll, that definition is the single most important sentence in the section for you.
What if we discover it after the person has left?
Crime policies generally respond on discovery, so what matters is that cover was in force when the acts happened and that you discover the loss within the period the wording allows. There is usually a stated window after a policy ends. If you are changing insurers, ask how the discovery period is being handled, because that is where gaps appear.
Will the insurer expect us to prosecute?
Wordings vary, and most require you to co-operate with any investigation and to keep the records that prove the loss. Businesses often prefer to handle these quietly, which is understandable and can affect a claim. Read that condition before you decide how you want to deal with it.
What proof does a claim need?
Records. Bank statements, ledgers, inventory counts and the trail that shows what normal looked like. The businesses that struggle are the ones where the person who took the money was also the person who kept the records. That is an argument for the controls as much as for the insurance.
Two that sit either side of this one: what a cyber policy will not cover and what happens when tools go missing.
Not the question you had? Send your declarations page and the question with it through the quote file and you will get a written answer, not a sales call.
Check whether crime is on the policy, not whether it could happen.
It is one line on a declarations page. Most businesses find out they do not hold it at the worst possible moment.