Bond and Crime
An accusation of employee theft doesn’t have to be true to create big problems for your cleaning business. The reputation of your business depends on the trustworthiness of your employees and the process of how you walk clients through these situations. Employees are often alone with valuable personal property belonging to homeowners and business clients. When expensive jewelry or a flash drive goes missing, it’s very easy to point fingers at the cleaning staff that was alone in the building.
That’s why Janitorial Bonds or Crime Coverage are a critical part of your risk management strategy and to the success of your cleaning business. These coverages respond to losses if an employee steals property or money from a client while cleaning their home or business.
As you research your options, you may hear the following terms:
- Janitorial Bond
- Crime Coverage
- Employee Dishonesty Coverage
- Fidelity Bond
- Custodian Bond
- Cleaning Service Bond
- Maid Surety Bond
The desired coverage can be provided in several ways, through a bond or through insurance policies. From an insurance perspective the coverage can be provided through a Business Owners policy, a package policy or even a standalone Crime policy. Or you can utilize a bond that would indemnify the client in the case of there being stolen items.
With the various options available, it is important to remember that not all bonds or policies are created equal. Specific language within the policy or bond may leave unintended gaps in coverage for you.
Let our experienced team at Moody walk you through what you may need to protect your cleaning business from this very common claim scenario. We help clients understand how the following considerations affect their coverage and business.
Considerations For Bond or Crime Coverage
- Evaluate how you conduct criminal background checks. This is a requirement of nearly every insurance company who offers this coverage. A state-wide check is the most common. However, if the employee has lived out of state, you may need to pull additional state reports.
- Make sure you understand how your policy defines a “dishonest act”. Most policies indicate that an employee who has committed a dishonest act in the past will not be covered. “Dishonest Act” may or may not be defined in the policy. Usually, a dishonest act would involve theft, drug-related crimes and similar infractions.
- Check your policy language for a conviction requirement. Some policies require that an employee be convicted of a crime before a customer theft claim will be paid.
- Many policies do not have a conviction requirement, but they may require that a proof of loss form be signed stating that you believe your employee(s) was responsible and naming the responsible employee(s). Once named, the employee(s) is no longer eligible for coverage.
- Check your policy for a contract requirement. Some policies require that there be a written contract or a written agreement for services between you and your client. Be sure to review this requirement, and your use of contracts.
The team at Moody has over 20 years advising cleaning business owners like you. We are independent. This means we work for you, not the insurance or bond company. Our assessment process can give insight into what bond or crime insurance would fit you best. We look forward to working with you.