Crime / Fidelity Insurance

Crime/fidelity insurance is essential for safeguarding your community's financial well-being. It offers crucial protection against financial losses caused by theft, fraud, forgery, embezzlement by board members or individuals covered under the policy.

Who does crime/fidelity insurance cover?

Crime/fidelity insurance protects those who help keep your community running smoothly, including:

• Board members
• "Associates" as defined in the policy
• Volunteers

What does crime/fidelity insurance cover?

This type of policy also helps protect your community from financial risks, covering incidents such as, but not limited to:

• Embezzlement
• Theft
• Forgery
• Fraud

Coverage Requirements

For example, Fannie Mae and Freddie Mac are government-sponsored enterprises that play a vital role in supporting the U.S. housing market. While their coverage requirements for crime/fidelity insurance are well-known, it’s important to note that some states have different and specific laws mandating this coverage. For Condos, Co-Ops, and other community associations, the required coverage must meet or exceed 100% of reserve funds, plus three months of operating income, ensuring financial stability and compliance with local regulations.
 

Why is this coverage important?

As defined in the policy, crime/fidelity insurance covers losses from forgery, fraud, embezzlement, or theft committed by board members or others classified as "associates" under the policy. The term "associates" refers to specific roles and individuals identified within the policy, ensuring protection for those directly involved in managing the community's finances. This coverage serves as the first line of defense in maintaining the community's financial health in the event of a loss.
 

Real-world scenarios

• Board member embezzlement: A board member misuses association funds for personal expenses. Crime/fidelity insurance covers the loss, allowing your community to recover the misappropriated funds.
• Check Forgery:  An associate of the community forged the signatures of board members on checks, diverting funds for personal use. The crime/fidelity insurance policy provides coverage for the loss, protecting the community from significant financial harm.

Invest in your community's protection

Our team at FS Insurance Brokers is committed to providing you with expert advice and solutions for complex insurance situations. By choosing us, you are partnering with industry experts dedicated to your community's long-term security and financial stability.

Our commitment to management education, mitigation, and controls allows us to source superior programs with coverage at competitive, needs-based rates.

Contact our team of experts today to learn how our property insurance expertise can help protect your assets and secure your community's future.