If your business relies on an employee workforce, manages inventory, handles payments, and uses digital tools, it’s likely prone to both internal and external crime. Commercial crime insurance is a necessary policy to add to your existing liability coverage, as it helps you avoid the consequences of crimes perpetrated against your business. In the guide below, we’ll explore the various aspects of commercial crime insurance—including employee dishonesty coverage—as well as the circumstances you may need it under. Then, we’ll outline how to compare policies, followed by a list of top companies to consider when searching for the right commercial crime insurance.
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Commercial Crime Insurance Overview
Commercial crime insurance is necessary to protect businesses of any size and scope from employee-related and third-party crimes. A crime perpetrated by a trusted employee or outside individual can cause lasting financial, physical, and emotional loss. To understand the scope of employee crime or occupational fraud risk, consider these statistics from a recent Association of Certified Fraud Examiners (ACFE) report: organizations lose an estimated 5% of revenue to fraud each year, with an average loss per fraud case of more than $1.5 million.
Further, a study from the Software Engineering Institute at Carnegie Mellon University found that a majority of fraud and theft threats against organizations stemmed from officially-employed insiders. While theft or property damage committed by a third-party is always a threat, employee-related incidents tend to be more common.
Any instance of employee dishonesty can be devastating, but many kinds of crimes can also undermine your business’s reputation, forcing operations off track and throwing a wrench into your revenue. Along with other insurance policies for business owners, commercial crime insurance is recommended as a basic protection against these types of events.
What Is Commercial Crime Insurance?
Commercial crime insurance protects business owners from financial loss caused by criminal activity. This can include crimes perpetrated by either employees or non-employees, and can include crimes such as theft, property damage, forgery, and fraudulent bank transfers, among others. Various forms of crime insurance include employee dishonesty insurance, third-party crime coverage, fidelity bonds, business services bonds, and ERISA bonds. Because commercial property insurance excludes a wide range of criminal activity, commercial crime insurance adds a necessary layer of protection to your business.
When comparing policies, most are organized around the type of person committing the crime (an employee or outside party) and who the crime was perpetrated against (the business itself or one of the business’s customers). Depending on your insurance policy, it will either include first-party coverage, third-party coverage, or a combination of both, which is the most secure. Costs covered under first-party coverage include claim expenses and direct financial losses sustained by your company, including the loss of physical property. Some policies may also cover proof of loss costs, or costs incurred as a result of needing to provide evidence of a crime against your business. This entails hiring forensic experts and investigators that can compile a proof of loss portfolio to present along with your claim.
If you’ve heard the phrase “fidelity bond” used interchangeably with “crime insurance,” you might be questioning whether there is any difference between the two. Fidelity bonds constitute a specific type of crime insurance that addresses crimes stemming from employee actions. Employee dishonesty bonds, business services bonds, and ERISA bonds are the three main categories of fidelity bonds, and each protects businesses from a specific set of crimes, which will be outlined later in this guide. It’s important to note that a business services bond can strengthen your commercial crime insurance by covering the reimbursement of losses sustained by your customers as a result of your employees’ actions.
Individual fidelity bonds are an effective way to shield your business from the effects on employee crime, but they don’t provide as much coverage as a broad crime insurance policy. As mentioned before, commercial crime policies usually cover not only employee-related crimes, but also those crimes carried out by third parties.
How Does Crime Insurance Work?
A crime insurance policy is often added to an existing BOP (business owners policy) or general liability insurance policy. Commercial crime coverage functions like many other common forms of business insurance: in exchange for a monthly or annual premium paid by the policyholder, the insurance provider assumes financial risk in the event of a covered claim. Covered claims generally fall under two broad coverage categories. First-party coverage protects your business from direct losses resulting from criminal activity perpetrated against your business, usually by an employee. Although, this coverage can be extended to cover criminal activity committed by an outside party. Third-party coverage, on the other hand, protects your business in the event that another entity—such as a client or business—claims your business (or employee of your business) committed a criminal act against them. This type of coverage is common for businesses whose employees work at a client’s property.
Most commercial crime insurance policies operate on a “named perils” basis, meaning that in order for a loss to be covered, the loss and crime that caused it must be specifically named in the policy. If a loss or crime type is not specifically named in the policy, it will not be covered. For example, a policy might state that the insurer will compensate the insured for direct losses sustained as a result of impersonation fraud, meaning instances of that specific kind of fraud would be covered.
Another type of policy, which is far less common in the U.S., is an “all-risks” crime policy. Unlike named perils policies, all-risks policies include broad language that cover a wide range of incidents. With all-risks policies, all losses and types of crimes are covered, as long as they are not specifically excluded from the policy.
In addition to whether the policy is written as a named perils or all-risks policy, how coverage is triggered is also an important component to consider. Commercial crime policies make use of either a “loss-discovered” or a “loss-sustained” trigger.
Policies that use a “loss-discovered” trigger will cover any losses incurred by your business that are discovered within the policy period. The loss will be covered even if the actual crime took place weeks, months, or even years before. This is usually preferred, as it gives business owners more time to discover, and then claim a loss.
Unlike discovery triggers, “loss-sustained” triggers require that the loss is both sustained and discovered during the policy period in order to qualify for coverage. Under these terms, losses that go undiscovered for some time may not be covered. Similarly, losses that are discovered during the policy period but occurred prior will also not be covered. Because of these limitations, this type of trigger is considered less desirable, especially if your business is at risk of electronic crime—instances of transferred funds or tampering with a computer system may not be immediately obvious.
Policy rules vary, but generally, the insuring company must be notified of a discovered loss in writing as soon as possible. Proof of the losses incurred must be provided as well, within a few months of the initial discovery. Proof of loss may not be immediately obvious or easy to gather and present, so be sure to familiarize yourself with your policy’s terms—- some companies may cover the cost of hiring specialists to help you compile the necessary body of evidence.
The last component of commercial crime insurance that must be considered is the policy limit. While some insurance policies have aggregate limits that define the maximum cost your insurer will cover throughout a single policy period, commercial crime insurance does not. Instead, the limit of a crime policy defines the maximum cost an insurer will cover per occurrence, or per claim regardless of how many claims are filed during the policy period.
What Does Crime Insurance Cover?
Crime insurance covers a range of crimes committed against a business, both on the part of employees and third parties, or outside perpetrators. This includes theft, forgery, and other acts of fraud, as well as computer-based crimes, which have been on the rise over the past decade. Direct costs covered include reimbursement of financial and property losses. The following sections provide an overview of the most common types of criminal acts usually covered by crime insurance.
Employee Dishonesty & Theft
Employee dishonesty and theft should be on any business owner’s radar, even within a company based on trust and communication. Petty theft, shoplifting, and property damage perpetrated at your business are among covered circumstances. If off-premises coverage is specified as part of your policy, theft committed in transit will also be covered—in a situation where money or property is being physically moved between locations, for example.
This also applies to thefts committed by an employee at a work site. Consider the example of a carpentry business owner who receives complaints from a number of clients who notice valuables missing from their homes. They may suspect that an employee who worked in each of the homes may be at fault. If that is found to be true, the cost of the clients’ property will be covered by the business owner’s combined first- and third-party commercial crime insurance policy. Policies that specifically target employee-related theft are often referred to as employee dishonesty insurance.
Theft committed by a third, outside party not employed by your business is also covered by commercial crime insurance, as long as your policy includes both types of coverage. This includes theft of property, theft of money, and destruction of money or securities.
Computer to computer hacking is a kind of computer fraud that is covered under commercial crime insurance. This would enable a hacker to transfer funds and/or information to an outside source, causing financial loss. False transfer requests are another form of electronic fraud in which the perpetrator instructs a bank to transfer funds under the insured’s name.
Social Engineering Fraud
Also called impersonation fraud, social engineering fraud encompasses a number of manipulative actions a criminal may undertake to convince you or an employee to transfer money. This kind of fraud often includes phone or email contact, and requests to wire money or change a vendor’s account details. Perpetrators may target an individual after doing research on the business they work for, to make sure the scenario they are proposing seems believable.
Many will operate on a purported basis of trust, after learning enough about their target to impersonate a vendor or a party otherwise affiliated with your business. As the consequences of social engineering fraud may not become obvious until it is too late to regain lost revenue, this is where a loss-discovered form would prove safer than a loss-sustained form.
Forgery can take various forms, but fraudulent check signatures are a common instance of employee crime. Crime insurance coverage can protect you from forgery under your name, as well as alterations. Alterations include any unauthorized changes to checks or other documents under your name. Forgery, alteration, and embezzlement are examples of other crimes that are often committed internally and may not be immediately noticeable.
If your business receives counterfeit currency from a payment transaction, your financial losses incurred as a result will also be covered by commercial crime insurance. This also includes instances of counterfeit money orders. Counterfeit payments may not be immediately noticeable, and they are often discovered after the transaction has been made.
Crime Insurance Exclusions
While most of the crimes included under a commercial crime insurance policy may seem straightforward, it’s important to note some exceptions. Like most insurance policies, crime insurance has specific exclusions that you’ll want to keep in mind.
As a reminder, most commercial crime policies are written on a named perils basis, meaning that only the incidents and types of costs specifically listed on the policy will ultimately qualify for coverage. In general, crime policies cover direct losses incurred as a result of criminal activity committed by employees or outside parties. Crimes committed by business owners, indirect losses, legal fees, and losses resulting from non-criminal activity are usually excluded from standard policies. For more details on what’s not covered by crime insurance, continue reading below.
Unlike many other commercial insurance policies, commercial crime insurance won’t cover any legal fees incurred by your business. While some insurers may cover the cost of hiring specialists to help you gather proof of loss, the cost of hiring a legal defense team will not be covered in most scenarios. When it comes to assistance with gathering proof of loss, coverage is not guaranteed and varies from policy to policy.
Employees With Criminal Records
If you, as the insured, become aware of a crime or crimes committed by a particular employee, any further losses caused by that employee will not be covered. The first instance of you becoming aware of crimes perpetrated by that employee triggers the “discovery of loss.” For example, if you witness an employee stealing money from the cash register, but wait until it happens again to address the crime and open a claim, the second instance of theft may not be covered. Also, if you, as the insured, are aware of an employee’s criminal history, further crimes committed by that employee may not be covered under a commercial crime policy.
Theft Committed by Owners or Partners
Crimes committed by business owners, business shareholders, or senior partners will not be covered by commercial crime insurance.
Data losses or breaches include the loss of information such as client lists, sensitive customer information, business plans, and intellectual property. While such incidents usually result in indirect financial losses in the form of third-party lawsuits, legal fees, restitution, and data recovery, they don’t cause direct financial losses, which is what crime insurance is designed to cover. Because of this, the indirect losses caused by cyber attacks and data breaches are not covered by crime insurance, and are instead addressed with a cyber liability policy.
Computing & Accounting Mistakes
Computer or accounting mistakes of a non-criminal nature will not be covered under commercial crime insurance either. For example, say one of your employees in the accounting department makes a mistake in their work that results in the business having to pay a sizable penalty to the IRS. This would not be covered by crime insurance. Similarly, say one of your website developers makes an error that causes your company’s website to go down for hours, which results in lost sales and revenue. Again, this would not be caused by crime insurance since the nature of the incidents stemmed from mistakes rather than criminal activity.
As a side note, in both of the examples above, a mistake by an employee resulted in a loss for the business they are employed by. Had their mistakes resulted in a loss for one of your business’s clients, a professional liability insurance policy would provide coverage.
Since reasons behind inventory discrepancies can vary between criminal and non-criminal intent, inventory discrepancies without evidence of theft will not be covered under commercial crime insurance. Some examples of evidence of criminal activity include video tapes, witness statements, and transaction records that indicate an employee was unlawfully taking and/or selling company products for their own gain.
If a criminal act against your business leads to indirect losses like loss of income or interruption of regular business practices, those will not be covered under commercial crime insurance. Direct business losses stem from acts like property theft, theft of money and securities, and unauthorized transfer of funds between accounts. Criminal acts that result in indirect losses for your business can be covered under a business interruption policy.
Who Needs Crime Insurance?
There are a number of telling factors that put certain businesses at higher risk of crime than others. While internal protocols and risk-management solutions can prevent certain risks, including crime, the following businesses would benefit most from commercial crime protection.
Businesses with a significant part-time workforce will benefit from crime insurance. The more part-time employees there are to keep track of, the greater the risk of missing internal employee theft. The same goes for businesses with large product inventories. The more inventory a business has to manage, the harder it is to track employee theft or inventory discrepancies.
According to Embroker’s statistics, American businesses lose up to $50 billion a year on employee theft. As most businesses rely on cash transactions or digital data—including digital transactions, customer financial records, and company financial records—they are at risk of both internal and external theft. Any business that deals with direct payments, digital information, and financial records is susceptible to having sensitive information and funds stolen or transferred without authorization.
Commercial Crime Insurance Requirements
While most commercial crime insurance policies are not mandated by federal law, there are certain scenarios in which a crime insurance policy may be a contractual requirement or otherwise required for conducting business with another party.
For example, certain clients may require you to secure fidelity bonds before finalizing a contract. Fidelity bonds are sub-categories of commercial crime insurance that address specific circumstances, which will be outlined in detail in the next sections. Businesses that provide employee benefit plans are also required to purchase fidelity bonds under the ERISA, or Employee Retirement Income Security Act, as a way to protect participating employees’ assets.
Rules regarding specific fidelity bonds also vary by state. For example, California requires every HOA, or homeowner’s association, in the state to secure an HOA fidelity bond. The same goes for Florida, unless the requirement is unanimously waived.
While crime insurance is often recommended for businesses with large workforces and inventories, small businesses will also benefit from the protections it offers. Small businesses that rely on both card and digital payment transactions will benefit from commercial crime protections, especially in instances of an employee mishandling inventory or funds. Though this may surprise you, 90% of large theft-related losses are estimated to stem from employee dishonesty. Small businesses that regularly handle product or customer property may be more prone to internal theft as well.
Since banks and other financial institutions regularly work with money transfers, sensitive customer information, and high-value transactions, they may be more prone to employee dishonesty, forgery, and fraud. This makes banks, credit unions, and brokerage companies prime candidates for comprehensive crime insurance plans. While actual bank robberies are relatively rare, employee-related crimes are considered to be one of the largest risks banks and other financial institutions face.
Homeowners Associations (HOAs)
Homeowners associations, or HOAs, are another type of business that is vulnerable to crimes like embezzlement, theft, and fraud. HOAs often use multiple accounts to store funds in anticipation of large purchases. The amount of money stored in these accounts has a tendency to grow quickly thanks to regular member payments. Since HOAs are often managed by a small group of employees or supervisors, the money in their accounts may not be kept track of regularly. This can make HOA accounts easier to target.
If, for example, an HOA has set up a long-term account in anticipation of full roof replacement, and an internal employee begins siphoning a small amount of money monthly, the discrepancy may go unnoticed for a long period of time. This is especially true if the money in the account grows regularly because of monthly payments and there’s not enough officials overseeing the numbers each month. Commercial crime coverage would provide protection in these types of scenarios.
Commercial Crime Coverage Compared to Other Policies
Commercial crime coverage may seem straightforward, but it’s actually fairly nuanced and often confused with other policies that address similar incidents. Two such policies are fidelity bonds and cyber insurance, which are discussed in more detail below.
Crime Insurance vs. Fidelity Bonds
While fidelity bonds fall under the umbrella of crime insurance, the two are not identical. You can think of fidelity bonds as a kind of crime insurance product with a different set of protections than a broader commercial crime insurance policy.
Fidelity bonds usually come in the form of employee dishonesty bonds, business services bonds, and ERISA (Employee Retirement Income Security Act) bonds, each of which serve a different purpose.
As their name suggests, employee dishonesty bonds will cover securities, money, and property theft perpetrated against your business by an employee. This coverage is necessary because other standard commercial insurance policies—like commercial property and general liability—won’t cover losses caused by internal employee theft. Examples of employee dishonesty range from physical theft of inventory to embezzlement of funds and the misuse of business or client credit card information.
Business services bonds are a type of fidelity bond that focus on protecting your customers as opposed to you and your business. If one of your employees commits a crime that results in a customer or client’s property or financial loss, business services bonds will cover the cost of replacing their loss. Business services bonds are also a reputation booster, as they communicate to your clients that their property and financial assets will be secure.
Resulting from the Employee Retirement Income Security Act of 1974, an ERISA bond is a fidelity bond that a business owner is mandated to take out to cover employee benefit plans, including pensions and 401k plans. This kind of bond has to cover at least 10% of the plan’s assets, and is meant to protect employees from dishonest activities that may affect their benefit funds. In most cases, ERISA requirements state that individuals who manage such benefit plans must secure a bond to cover losses from embezzlement, forgery, theft, or misuse of funds.
Crime Insurance vs. Cyber Insurance
As discussed above, commercial crime insurance focuses narrowly on direct, tangible monetary or property losses that result from crimes committed against your business (by an employee or third party), as well as crimes committed against your customers by an employee of your business. The types of crimes covered could be perpetrated electronically or involve the physical theft of property. The most important thing to note is that in general, for crime insurance to cover an incident, money or property must have been stolen.
Cyber insurance, also known as cyber liability insurance, covers indirect losses that result specifically from some form of electronic crime perpetrated against your business, such as a data breach or cyber attack. These indirect losses include those incurred by your business in responding to the incident—for example legal expenses, data recovery, lost income, public relations, fines, and customer notification. Indirect losses also include those incurred should a third party bring a lawsuit against your business following the incident.
As a business owner, it can sometimes be difficult to determine which policy would apply to a given incident. To help, consider the following:
- If the incident resulted in a tangible loss of money or property, crime insurance will usually be the applicable policy
- If the incident resulted in an intangible loss—such as the theft of sensitive customer information, account numbers, etc.—cyber insurance will apply
When it comes to what costs the policies will actually pay for, keep in mind:
- Crime insurance reimburses for direct losses based on the value of what was actually stolen. Crime policies don’t cover legal fees, public relations costs, loss of income, etc.
- Cyber insurance, on the other hand, reimburses for indirect losses incurred while effectively responding to the incident. This does include legal fees, lost income, PR, etc.
Commercial Crime Insurance Costs & Premiums
As with other forms of commercial insurance, premiums for commercial crime coverage vary widely based on a variety of factors. In addition to the premium, businesses should also consider the deductible, which will impact the total amount paid before any money is actually received from the insurer in the event of a claim. These details are explained in greater depth below.
How Much Does Commercial Crime Insurance Cost?
For most small businesses, commercial crime insurance is an affordable policy that is a smart choice to have. Policies for small businesses typically range in price from less than $1,000 to a few thousand dollars annually. Another way to think about the cost of crime insurance or fidelity bonds is as a percentage of the total coverage amount. Depending on a variety of factors related to your business and the policy limit, business owners can expect to pay between 0.1%–3% for their policies.
Factors That Affect the Price of Crime Insurance
As with any insurance policy, there are a number of factors that can affect your final premium.
- Coverage limit and deductible: Generally speaking, the higher your coverage limit, the higher your annual cost will be. According to Insureon, a fidelity bond with a coverage limit of $1,000,000 may total about $1,00 in annual costs, while a policy with a limit of $2 million may amount to about $1,750 yearly. Deductibles, or the amount that is paid out of pocket before a claim is covered, can usually be chosen by the insured. Generally speaking, the higher the deductible, the lower the premium and vice versa.
- Industry: Your business’s industry will affect the cost of your commercial crime insurance premium. High-risk industries will incur larger costs than industries deemed low-risk. High-risk industries typically include high-traffic retail, tech, and financial institutions.
- Revenue and property: Higher revenue means a higher risk of funds being misused, stolen, or tampered with. This will result in higher annual premiums. The same goes for property—owning and using expensive property puts your business at higher risk of theft.
- Security: The more security measures your business takes, the lower your premiums may be. Measures that can help protect your business from theft, fraud, and other crimes include setting up effective alarm systems, investing in a robust security camera network, and auditing employees.
- Claims history: Your business claims history affects your annual costs, as it is a strong indicator of your business’s liability risk. A history of claims waged against your business will likely increase your premiums.
Comparing Commercial Crime Insurance
As with any kind of insurance, you’ll want to compare and contrast commercial crime policies to find the best fit for your business. The following factors should all be considered when weighing your options.
Coverage Options & Policy Limits
When considering your coverage options, be aware of whether a policy utilizes a “loss-discovered” or “loss-sustained” trigger. Similar to an occurrence-based liability policy, a loss-sustained policy will only cover losses that both took place and were discovered while the policy was active. Policies written on a discovery basis, on the other hand, will automatically cover losses that were discovered within the active policy period, no matter when they took place.
You’ll find that most commercial crime insurance policies operate on a “named perils” opposed to an “all-risks” basis, meaning that losses claimed must be within the categories outlined in the actual policy. You’ll want to read through your policy carefully to be aware of the specific losses that it names and covers.
Claims expenses are another aspect of your commercial crime insurance policy you’ll want to pay attention to, as claim expenses coverage limits may vary. Your claim expenses are separate from the cost of reimbursing stolen goods and assets—claim expenses encompass the costs of the claim itself. When it comes to submitting crime claims, the cost may be even higher since forensic experts may be needed to provide evidence along with a team of attorneys. A higher claims expense limit will mean a higher premium, but may save you money in the event of an expensive claim you submit on behalf of your business.
Your policy limit is the maximum amount your insurer will pay out for a claim covered by your policy. Most insurers offer a range of limits to choose from, and higher limits usually mean higher premiums. Keep in mind that when it comes to commercial crime insurance, the limit won’t be aggregated, meaning it will apply individually to each loss incurred.
Premiums & Deductibles
As is the case with most insurance policies, your premium, or annual cost of insurance depends on a number of factors, including the size and scope of your business, your coverage limit, and your claims history. However, business owners can look for reduced limits, higher deductibles, and policies with less flexibility to save money on annual costs.
Financial strength is an important factor to consider when looking for a commercial crime insurance provider. Financial strength ratings are subject to change, so you’ll want to check rating agencies like AM Best, Standard & Poor’s, and Moody’s for the latest scores. By rating insurance companies on a number of factors, including how effective they are in meeting their financial obligations when it comes to claim coverage, these agencies can help you choose the most reliable provider.
Along with financial strength, a company’s reputation with its customers is crucial to choosing the right insurer. Sources like the Better Business Bureau and J.D. Power analyze companies’ customer ratings and reputation, allowing you to access information that may not be readily available otherwise. Similarly, the National Association of Insurance Commissioners (NAIC) also provides comprehensive data on insurance companies, incorporating a complaint index that compares performance across insurers. Obtained by dividing the company’s complaints by its share of premiums, the index is a reliable indicator of an insurer’s reputation.
The Best Commercial Crime Insurance Companies Overall
Chubb (Best Commercial Crime Insurance Overall)
Known as a leading underwriter, Chubb is a sound choice for large and mid-sized businesses that need a reliable, comprehensive commercial crime insurance policy. The company goes above and beyond in providing detailed information for customers about its crime insurance offerings generally, as well as for specific policies.
- Offers a loss-discovered policy, which is preferable to loss-sustained
- Offers an all-risks insuring clause
- Covers the costs of customer notification in the event of a data breach
- Chubb’s policies are usually more expensive than those offered by competitors
Along with providing a transparent guide to all of its commercial crime insurance services on its website, Chubb specifies important highlights of its crime policy right away. The company’s commercial crime insurance operates on a loss-discovered basis, meaning it covers losses that are discovered within the policy period, no matter when the actual crime occurred. This is highly preferable to the alternate loss-sustained policy form, which limits coverage to losses that take place during the policy period. Chubb’s loss-discovered policy takes into account crimes that may not be immediately obvious, and are only realized after a long period of time.
The company is similarly transparent regarding its all-risks insurance clause. As opposed to a conventional named perils policy, an all-risks policy is not limited to only covering the specific risks outlined in the insuring agreement. This results in broader coverage and less risk assumed by the customer.
Another benefit of Chubb’s commercial crime coverage is the company’s commitment to covering costs like customer notification in case of a data breach. Notifying customers when their information has been put at risk can be a highly expensive task, and Chubb’s ability to cover these costs can relieve you of an additional financial burden in an already difficult situation. This, along with the services listed above ensures your peace of mind in case an electronic or physical crime is committed against your business.
The company’s NAIC complaint index is listed as 0.43, putting it far below the expected market index of 1.00 when it comes to complaints. This is a positive sign, as it is indicative of the company’s low frequency of complaints when compared to other insurers.
Chubb’s extensive list of services and policy benefits mean that the company’s insurance packages tend to be more expensive than those of its competitors. This is part of the reason why Chubb’s coverage is often recommended for larger and mid-sized businesses with greater financial resources. However, with Chubb, you do get what you pay for. And even despite its more expensive policies, we still recommend Chubb as offering the Best Commercial Crime Insurance Overall.
Embroker (Best Online Experience)
Founded in 2015, Embroker is a business insurance provider founded on the principle that the insurance buying process should be able to keep up with the digital world. With customer service and easy navigation as top priorities, the company is an exciting newcomer to the insurance industry.
- Known as the first digital business insurance provider
- Commercial crime coverage is available for purchase online
- 24/7 customer service, including the option of a personal account manager
- Embroker’s backing insurer, Munich Re, has exceptional ratings from AM Best
- Founded in 2015, the company has less experience in the industry than most of its competitors
- Embroker’s online shopping experience is less conducive to larger organizations with more complex needs
Known as the first digital business insurance provider, Embroker boasts digital proficiency, twenty thousand users, and a defining partnership with top insurance provider Munich Re. Incorporating modern digital tools and artificial intelligence, the company makes it easy for business owners to apply for commercial insurance online, purchase plans, and manage their policies through their personal portal.
Along with “Startup” packages for new ventures and “Growth Stage” packages for expanding business, Embroker offers standalone commercial crime insurance policies tailored to your business’s needs and potential risks. If you need help settling on a policy, assessing your risk profile, or choosing a policy limit, Embroker’s 24/7 customer service specialists are on call via phone, email, or chat. For more in-depth recommendations, Embroker can connect you with a personal account manager who can go over your questions and concerns in detail.
If you’re looking to learn more about the company’s reputation and financial history, you’ll find that Embroker itself does not have ratings from any of the top agencies, including AM Best, Moody’s, Standard & Poor’s, or the NAIC. This is because Embroker functions more like an “insurance platform” than a traditional standalone insurance company. Instead of being exclusively written by Embroker, its policies are actually backed by eight different insurers—including Munich Re—all of which have excellent financial ratings.
Embroker’s innovative approach to business insurance speaks to the company’s pioneering role in a highly digital era. Instant quotes, an excellent online experience, and the support of Munich Re make Embroker an exciting option for business owners looking for a variety of commercial insurance policies. For these reasons we rate Embroker as offering the Commercial Crime Policy With the Best Online Experience.
Hiscox (Best Crime Insurance for Small Businesses)
Founded at the turn of the 20th century, Hiscox has well over 100 years of experience in the insurance space and is one of the nation’s top providers of commercial policies. Offering broad coverage options, Hiscox’s policies are an excellent choice for small businesses in nearly every state.
- Specializes in commercial insurance for small businesses
- Strong reputation in claims handling
- Broad employee definition when considering employee crimes
- Coverage options aren’t ideal for larger organizations
- Limited online tools
Throughout its long history, Hiscox has zeroed in on small business insurance as its primary focus, making it a popular choice for businesses with 10 or fewer employees. Today, the company counts over 500,000 customers, offering specialized insurance plans for a number of professions. Hiscox holds a financial strength rating of A from both AM Best and Standard & Poor’s, and an A+ rating from Fitch. The company also works with Feefo, a third party platform that collects and manages small business owner reviews of Hiscox’s services. Public access to Feefo means that you can read through the company’s most recent feedback from customers.
When it comes to claims reporting, Hiscox makes the process easy by offering online, phone, and mail options. If you purchased your policy through an agent, you can also have them file a claim on your behalf. Hiscox has invested over $200M in claims expertise over the past five years, with the goal of forming a robust network of 800 insurance claims specialists across the world, including claims lawyers and adjusters. Filing and tracking a claim can be the most daunting part of protecting your business, and Hiscox’s large community of claims experts is meant to take the burden off your shoulders by helping you through the entire process.
When it comes to commercial crime insurance specifically, Hiscox has strong options for small businesses. Covering events ranging from employee theft to the cost of establishing the existence and amount of a loss, Hiscox’s crime insurance policies are flexible and attuned to the changing nature of crime-related risk. The company’s broad definition of what constitutes an “employee” is one of its major pros, especially when considering employee dishonesty and theft. Hiscox’s definition of an employee includes temporary and leased employees, including former workers in consulting positions. Guest students, interns, uncompensated officers, trustees, volunteers, and employees on medical leave also fall under its broad policy language. This makes Hiscox’s commercial crime coverage more flexible than that offered by many of its competitors.
While Hiscox is known for its focus on small businesses, it may not be the best choice for larger organizations with more complex needs. One other small downside to note is that the company’s most recent NAIC complaint index came in at 1.14, which is slightly above the expected market average of 1.00. That said, in 2019, Hiscox had a complaint index that was about 30% below average, so we don’t consider this to be much of a concern.
Overall, Hiscox is a highly reputable insurer committed to resolving the unique risks small businesses face. This expertise, coupled with a strong claims handling department and flexible commercial crime coverage, makes Hiscox our choice for having the Best Crime Insurance for Small Businesses.
Travelers (Best for Customer Service)
A long, successful history in the field and loyal customer base have made Travelers a household name in American insurance. Popular with owners of both small and large businesses, Travelers offers a variety of coverage types, including but certainly not limited to fidelity and crime insurance.
- 24/7 customer service access and claims reporting services
- An extensive national network of agents
- High ratings from both AM Best and Standard & Poor’s
- No option to purchase coverage online
Lauded for both its expertise and range of coverage options for business owners, Travelers is one of the country’s leading commercial insurers. With service options listed by industry and business size, it’s easy to navigate your way to coverage tailored to your business via the Travelers website.
Travelers bundles fidelity and crime coverage into single policies, providing broad protection from employee dishonesty and other crimes. The company offers a wide range of crime policies designed for both private and public companies, as well as small/new businesses and nonprofits. This sample crime insurance agreement from Travelers can give you a general idea of what to expect after choosing a policy. Online risk management resources focusing on coverage options and common threats can help you further narrow down the specifics of your policy from Travelers.
The company’s 24/7 online claims center makes filing and checking on your claim simple, especially if you take advantage of the provided Claim Guides beforehand. If you need assistance with filing a claim, or just have questions about settling on a policy or billing, Travelers customer service specialists are available 24/7.
The company’s national network of independent agents makes it easy to connect with a professional near you. However, its lack of a streamlined online quote tool may turn off some customers who prefer to handle their business insurance online.
The company’s most recent rating from AM Best is A++, a superior score. AA ratings from both Standard & Poor’s and Moody’s, as well as an Aa2 score from Moody’s reaffirm Travelers’s financial strength and credible reputation. Further, the company’s NAIC complaint index is 0.47, a figure indicating that Travelers receives far fewer customer complaints than its competitors.
While getting a quote from Travelers may not be immediate, the company’s vast agent network and customer service availability surpasses expectations. Considering its strong financial ratings and excellent customer feedback, we recommend Travelers as offering the Best Customer Experience.
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