Covers your business against losses caused by dishonest acts of your own employees — theft, embezzlement, forgery, computer fraud. Not required by statute in most cases, but essential crime coverage for any business with employees handling money, inventory, or client funds. Premium typically 0.5%–2% of coverage limit.
An employee dishonesty bond — sometimes called an employee fidelity bond or commercial crime bond — is a first-party fidelity bond that pays your business if one of your employees steals from you. Unlike liability insurance, which pays third parties, this bond reimburses you for the loss directly.
The exposure is bigger than most owners realize. Association of Certified Fraud Examiners data consistently shows the median internal-fraud loss runs into six figures and the median duration of schemes before discovery exceeds a year. A single trusted bookkeeper with signatory authority can drain an operating account over months before the owner notices.
Coverage typically includes theft of money, inventory, and securities; forgery or alteration of checks; embezzlement; credit card fraud; and in many cases computer fraud and funds-transfer fraud. The bond is written as a blanket form that covers every current and future employee without scheduling them individually.
If a client contract asked you to be "bonded," you may actually need the other fidelity bond — see business service bond vs. employee dishonesty bond for which protects whom.
Rate is a function of the coverage limit, number of employees, industry, internal controls, and the owner's credit.
| Coverage limit | Preferred rate | Standard rate |
|---|---|---|
| $25,000 Small business minimum | $150–$250 | $250–$400 |
| $100,000 Typical small business | $500–$800 | $800–$1,500 |
| $500,000 Mid-market coverage | $2,000–$3,500 | $3,500–$7,500 |
| $1,000,000+ Warranted financial account | 0.4–0.75% of limit | 0.75–1.5% of limit |
Businesses with strong internal controls (dual approvals, segregation of duties, background checks) typically qualify for preferred rates. Deductibles of $1,000 to $10,000 are standard.
We discuss cash flow, employee count, deposit amounts, inventory exposure. Goal is a limit that covers a realistic worst-case internal loss.
Short application, soft credit on principal for standard limits, financial statements for larger limits. Questions about internal controls shape the rate.
Surety issues the bond on crime-coverage form, delivered same-day as PDF. Original follows by mail. Coverage begins on the effective date you specify.
Renewal review 60 days before expiration. Limits can be adjusted up or down as the business changes. Claim-free history earns rate reductions.
Theft of money, securities, and property by employees. Embezzlement, forgery, alteration of negotiable instruments, and fraudulent computer transactions are typically covered on modern crime forms.
Generally includes W-2 employees, leased workers, and temporary staff under your direction. Independent contractors and vendors are typically excluded; business-services or third-party coverage handles those.
Most policies pay on a discovery basis — losses discovered during the policy term are covered, even if the acts occurred before the policy started (subject to prior-acts coverage terms).
Typical deductibles run $1,000 to $10,000 depending on limit and industry. Higher deductibles reduce premium but leave more loss uninsured.
Losses caused by the named insured or owners, acts occurring after termination of employment are typically excluded. Clerical errors and ordinary operating losses are not covered — this is crime coverage, not a business-interruption policy.
We work through cash-handling volumes and exposure points with you. Too little coverage is wasted premium; too much overshoots the real risk.
Several surety and crime-coverage carriers in our panel means better rate matching — especially for industries with higher internal-theft statistics.
When a claim hits, we coordinate notice, proof of loss, and documentation with the carrier so your attention stays on running the business.
Premium typically runs 0.5% to 2% of the coverage limit per year. A $100,000 bond costs $500 to $2,000 annually. Rate depends on the number of employees, the nature of the business, any internal controls in place, and the owner's credit. Businesses handling large cash deposits, inventory, or customer funds pay toward the higher end of the range.
It covers losses your business suffers from dishonest acts committed by your own employees — theft of money, inventory, equipment, or securities; embezzlement; forgery; computer fraud; and sometimes social-engineering schemes. Unlike a business services bond, the covered party is your business, not a third-party client. The bond is a first-party crime coverage, not a liability policy.
Most brokers recommend coverage equal to at least three to six months of typical cash flow, or the maximum amount a single employee could access at one time. Businesses with inventory add the wholesale value of any high-value stock accessible to employees. Limits from $25,000 to $1,000,000 are common; larger limits are available for enterprises with warranted financials.
A blanket bond covers every employee on the payroll at the effective date and automatically covers new hires as they are added. The alternative is a scheduled bond that names specific employees — rare today. Most businesses buy blanket coverage because it avoids the risk of an uncovered hire.
A short application with the business name, industry, employee count, revenue, and a few questions about internal controls (cash handling, dual approval thresholds, background checks). For smaller limits, a soft credit pull on the principal is usually sufficient. Limits above $500,000 may require recent financial statements and a review of the business's loss history.
Notify the surety promptly after discovery — most bonds have a 30- to 60-day notice requirement. Provide documentation of the loss: accounting records, bank statements, police report, and employee information. The surety investigates, may request additional evidence or a proof of loss, and pays the covered loss less any deductible. Paid claims almost always lead to criminal prosecution of the employee and are subrogated against them.
No. A business services bond protects your clients from theft by your employees while on the client's premises — it is third-party coverage typically marketed to cleaning services, in-home care, and similar providers. An employee dishonesty bond protects your own business from internal theft. Some Texas businesses need both; a cleaning company with a corporate office and client homes is a common example.
Same-day issuance on standard limits. Right-sized coverage for your cash flow and employee count.
