Fidelity bond premiums can cost a considerable amount. Do you fully understand the kinds of losses covered by the bond or when it is appropriate to provide notice of a loss to a company’s insurer? The ability to recognize the types of losses that give rise to a claim is vitally important, since fidelity bonds typically have fairly short and rigid deadlines for providing notice of a loss or submitting a proof of loss (often 60 days after the loss is first discovered).
Further complicating the picture, considerable investigation may be required to determine the amount, extent and cause of a loss. As a result, it may be necessary to provide notice of a loss before its magnitude or cause is fully known. This can pose difficulties for an insured organization unless the officers and employees likely to discover a potential loss, as well as those charged with reporting losses within the organization, are attuned to the circumstances under which a loss might be covered under a fidelity bond.
