Which type of insurance covers losses from fraudulent acts by employees?

Fidelity coverage is specifically designed to protect businesses from losses that result from fraudulent acts committed by employees. This type of insurance offers financial reimbursement in cases of theft, embezzlement, or other dishonest behaviors perpetrated by staff members. Companies that handle significant amounts of cash or have employees in positions of trust often invest in fidelity coverage to safeguard their assets and mitigate potential financial losses stemming from employee misconduct.

On the other hand, business interruption insurance covers lost income due to a temporary shutdown from events such as natural disasters. Errors and omissions insurance typically protects against claims arising from mistakes or failures to perform professional duties but does not cover employee fraud. Extra expense coverage assists businesses in covering additional costs incurred to maintain operations following a disaster but is unrelated to employee-related fraud. Understanding the distinction between these various types of insurance is crucial for organizations to effectively manage risk and protect their financial interests.