The board purpose
of this insurance to indemnify
the employer against direct
pecuniary losses sustained through acts of fraud or dishonesty by an employees (s). in course of employment. The basis of fidelity guarantee originates from an employer and employee relationship , The three parties
are employers employee and the insurance company. This insurance can be
classified as follows.: (a).
Commercial fidelity guarantee: (b).
Court bonds. ( C ). Government Bonds.
The first type commercial guarantee policies which are mostly in use are of the
following types: (1). INDIVIDUAL POLICY: To cover one named
employee: (2). COLLECTIVE POLICY: To
cover a number of named employees up to an agreed amount against each. (3). FLOATER POLICY: To cover a number of employees
without specifying the name of the employees and the amount against each, only the total guarantee is stated and
any loss up to the that sum is covered whether resulting from default of one or more employees.
INSURED PERILS: The perils covered under commercial fidelity guarantee policy
are mentioned in the operative clause
which suggest that the policy will indemnify the person insured again any pecuniary loss sustained by the him on
account of fraud or dishonesty of his
employees, subject of course, to the
limits of the indemnity incorporated in the schedule of the policy. The term
fraud or dishonesty are wide enough to cover losses suffered by the insured on account
of forgery, embezzlement larceny
and misappropriation and default of the
employees. The policy hinges on the employer
employee relationship and
therefore , in all the monetary transactions
the employee is expected to discharge his duties honestly and faithfully. In if the employees breaches the trust reposed by the employer and creates
and loss, the fidelity guarantee
policy covers in.
SPECIAL FEATURES:
(1). The following particulars
regarding the person to be guaranteed
should be satisfactory. (a), Character. (b). Financial position and Domestic
responsibility. ( C ) Previous experience. (d). Previous record of
service. (e). Amount guaranteed in
relation to the employee’s remuneration. (2). It is necessary to be satisfied
that the employer’s business methods are
satisfactory and that a regular system
or for checking and auditing of
account exists. (3). Floater Fidelity
Guarantee Policies should be discouraged except when it is necessary to accommodate in which case regional office should be
consulted with full details. (4). The
persons to be insured must be salaried employees.
CLAIM PROCEDURE: The employer
(insured) shall give immediate notice to the company on any discovery of loss due to the immediate to the company on any discovery of loss to
the fraudulent act of the employees
insured under the policy and shall furnish to the company further particulars of the claim as the company with explanations
and the evidences to substantiate the claim as the company reasonably requires . Therefore the insured shall on the getting by the any
hint about loss of money on account of
the insured employee’s can contact the insurance company and collect
the claim from for completion of formalities
within the time stipulated. The claim form contains questions relating a to details about the employees responsible for the loss,
details about the loss actions taken against the defaulting employee e. g. police case, details of immovable
properties owned by the employees of known and details about the other insurances, if any, held by the insured. On receipt of a
claim from which the details
mentioned above, investigation of the matter will be initiated . the investigation is entrusted to independent surveyor’s preferably
chartered accountants. The chartered
accountants will go into the books of the accounts throughly and
the circumstances of loss and finally
make his recommendations about the admissibility of the claim
and the actual amount the loss payable
under the policy.