- Your business has been burglarized and, you find yourself standing amid broken glass. There’s trashed shelving, broken displays and missing merchandise. While vowing revenge the thought comes to your mind: Will my insurance cover this?
- You realize your favorite cashier is been stealing from you. Taking $20 here and $50 there for several months. Now your loss totals more than $2,000. You make a note to ask your agent: Will my insurance cover this?
- You can’t believe it! Although your inventory records say you have 50,000 widgets in stock, there are only 1,000 in the warehouse. What happened to the other widgets? Lost? Stolen? Never delivered? As your heart sinks over the lost sale, you think: Will my insurance cover this?
- You watch sullenly, held motionless by the gun, as the thief cleans out the cash from your register. As fear mixes with anger, it is doubtful you are asking yourself: Will my insurance cover this?
The quick answers to the above are partially, possibly, unlikely and maybe.
One of the often confusing attributes of crime insurance coverages is that the terms used in the insurance policies reflect legal definitions, not the meanings we assume in everyday conversation. For example, in relating any of the above situations to a friend, you may describe all four as “I was robbed” or “that thief took everything I had!”
Yet, according to an insurance policy, the above incidents are four very different types of claims, and are described by four different, and sometimes mutually exclusive, terms. In order of their appearance, the terms are burglary, employee dishonesty (often called fidelity), disappearance and robbery. All of them, once connected to a dishonest act, are considered a form of theft.
The significance of knowing these terms, and the types of crime each refers, is that you purchase crime insurance to cover each crime or combination. For example, if your crime policy only provides burglary coverage, only the first scenario above would be a covered loss. If your policy only covers robbery, then only the last of the four would be covered.
So, if you want to be sure you have the proper crime insurance, do you have to memorize a batch of legal definitions, or risk buying the wrong coverage for your business?
No. This is where using the services of a Trusted Choice® insurance professional comes in hand. Trusted Choice® agencies who deal with crime insurance are already familiar with the vagaries, and can make sure you get the coverage most needed by your type of business.
And that is where you come in. Sit down with your Trusted Choice® insurance professional and talk about the types of crime losses that are most likely to apply to you, and which will cause the most pain. There are two basic issues to consider.
First, what is it you are afraid will be the focus of the crime? For some businesses, cash is their biggest exposure. For example, the owner of a plant store who also has his or her own nursery may feel the merchandise is easily replaceable at little cost. But if a robber comes in at the end of her ‘Welcome Spring Saturday Sale’ and takes the receipts from their biggest day of the year, they could be financially crippled.
For other businesses, merchandise is the key target. A jewelry store may have little cash on hand and a guard on duty during store hours. Their real exposure may be the risk of someone breaking into the store safe in the middle of the night and making off with a fortune in merchandise.
Second, who is most likely to commit the crime?
For many businesses, the real exposure is not someone outside the business trying to break in, but rather someone inside the business carrying the property out. It will do you no good to put bars in the windows, install a state-of-the-art security system, and then hand the keys to a employee you hired last week and say “be sure to lock up on your way home.” Do you have a bookkeeper, cashier or store clerk who can readily walk out the door with your property?
For other businesses, particularly those with few or no employees, the greatest exposure will clearly come from the outside.
Once you have determined these key coverage issues, your insurance professional will be able to recommend the crime insurance options best applicable to your business. Obviously, the more types of crime you try to cover, the higher the premium.
In making your decision, keep in mind the ultimate cost to your business health if you try to cut coverage too thin. Work with your Trusted Choice® insurance professional to be sure you have the coverage you need to keep your business thriving.
A criminal may steal your stuff. Don’t let poor insurance planning steal your dream.