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Menu - Fidelity Bonds

  • Business Services Fidelity Bond - An insurance policy to protect customers from unethical behaviors of the service provider's employees - eg. if an employee stole something while working in a clients office.
  • Employee Dishonesty Bond - This type of policy protects the employer from employee misconduct - eg., theft, forgery, embezzlement.
  • Financial Institution Fidelity Bond - This type of policy protects a Financial Services employer from employee misconduct - eg., theft, forgery, embezzlement.
  • Janitorial Services Fidelity Bond - Policy that applies specifically to misconduct committed by employees of cleaning services companies.

Fidelity Bond

Employee misconduct poses a large risk for any organization. One way to manage that risk is with a fidelity policy. In general, businesses aren't required to get fidelity bond, but many choose to get one as a kind of safeguard.

What is a Fidelity Bond?

Fidelity policies protect employers and their clients if employees commit illegal or unethical acts. For example, if someone responsible for managing money embezzled funds, fidelity policies provide a mechanism to recover those losses.

What types of Fidelity Bonds are there?

Fidelity policies work a little differently depending on the industry they relate to and the kind of misconduct they protect against. Here are three common examples:

  • Business Services Fidelity Bond - An insurance policy to protect customers from unethical behaviors of the service provider's employees - eg. if an employee stole something while working in a clients office.
  • Employee Dishonesty Bond - This type of policy protects the employer from employee misconduct - eg., theft, forgery, embezzlement.
  • Janitorial Services Fidelity Bond - Policy that applies specifically to misconduct committed by employees of cleaning services companies.

Fidelity policies allow employers or their customers to file a claim against the policy seeking financial compensation for damages caused by the misconduct of an employee. In most cases, a conviction is required to validate the claim of wrong-doing. As long as the claim is validated by a conviction, the surety company that issues the policy agrees to settle any claims. Fidelity bonds provide a mechanism for companies to recover from employee misconduct, which can have serious consequences for the company's bottom line and reputation.

Who should get a Fidelity Bond?

In many cases, a fidelity policy is not required, but optional, with the exception of some specialized types of policies that protects employee benefit plans as well as policies for public officials. However, many organizations choose to get one to help manage the risk of employee misconduct. They consider the likelihood of an employee breaking the rules and estimate the resulting costs, and many conclude that the fidelity policies offer a welcome level of protection.

Fidelity Bond vs Surety Bond

Surety bonds are like credit. The bond-holders debt can be paid from the bond in instances of a claim, but they must pay the surety back in full. Fidelity policies are a form of insurance. The policy holder can file a claim to help them recover from covered unexpected loss. Another difference is that surety bonds are mandatory while some fidelity policies are voluntary.

Commercial Insurance vs. Fidelity Bonds

Commercial insurance protects businesses and their customers from many types of liability, and in most cases the law requires some amount of coverage. In contrast, some fidelity policies are required by law, such as public official bonds, but many are either required as part of a working agreement, or optionally obtained to gain an additional level of protection for the policy holder and/or their clients.

Who are the parties involved in a Fidelity Bond?

Depending on the type of policy, there can be two or three parties:

  • The Principal - The policy owner. The party who purchases the fidelity policy.
  • The Surety - The company that issues the policy and settles valid claims.
  • The Obligee - The party that stands to lose from the dishonest actions of the principal or principal's employees. In some cases, the obligee and the principal are one and the same, such as an employer gaining protection from employees through an Employee Dishonesty bond.

How much does a Fidelity Bond cost?

The cost of a fidelity surety bond depends on the type of business, the number of employees, and the amount of coverage wanted. For the current pricing for your specific fidelity policy request, view the online application or call us.

Is bad credit a problem for getting a Fidelity Bond?

Fidelity policies are not credit driven. These policies are priced based on set specific factors for each type of fidelity policy. Obtaining a policy is a matter of completing the application and paying the premium.

How to apply for a Fidelity Bond?

The application process for most fidelity bonds is really simple. Our online application makes applying, paying and receiving the fidelity policy you need, simple and very fast. If you have questions before moving forward, feel free to call us, we are happy to answer any questions you may have about fidelity bonds.

Viking Bond Service - Fidelity Bonds Made Easy

You want a great surety bond but you don't want to scour the internet for options. Let Viking Bond Service do the leg work for you. As a nationally licensed surety agency, we can connect anyone with fidelity bonds that provide the coverage they need at a price they can afford. For more information, send your questions through the contact form on this page, or call us at 1-888-278-7389. You can also apply for a bond any time by completing our online application.

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