Fidelity bonds are important forms of insurance that protect businesses from a wide range of theft and fraud. Claims are designed to safeguard employers against such losses but can become significantly complex depending on the subject matter involved. Not all claims are covered, and insurers may have a right to reject them. Instances like these often invite litigation, which is where having an experienced California fidelity bond attorney will help.
The litigation team at Loew Law Group is well-versed in fidelity bonds and understands what it takes to defend insurers against excluded or baseless claims. We take the time needed to investigate the claim, review the details of the policy, and then advise our clients on their next best step. If necessary we also defend their interests in court.
What Is A Fidelity Bond?
A fidelity bond is a type of business insurance that protects employers against losses caused by their employers’ dishonest or fraudulent conduct. They protect against physical or monetary losses and are an important element of a company’s risk management strategy. Employers can be exposed to liability in the event their employees engage in theft or fraud, and may therefore be at risk of serious financial exposure. The fidelity bond exists to insure such losses.
Employers purchase these policies to cover such acts as:
- Theft from the company or a customer
- Wrongful conversion
- Destruction of company property
Companies that work in the following industries often purchase fidelity bonds:
- Retirement planning
- Non-profit organizations
In some industries, fidelity bonds are mandated. This is especially true in the financial industry where employees could potentially access and misappropriate large sums of a client’s money. For example, under ERISA (the Employee Retirement Income Security Act) pension plans are required to have fidelity bond coverage of at least 10 percent of the value of the funds they manage.
How Are Claims Handled?
When a loss is claimed under a fidelity bond, the first step is to investigate it. Often, this means uncovering whether a loss has even occurred. A data breach, for example, may or may not expose sensitive client information that later ends up on the dark web and is used to commit identity theft. Claims that implicate highly technical issues such as those involving computers, data, or confidential security information could require more intensive investigation. Experts in certain fields such as information technology or finance may be called upon to develop all relevant facts and determine the extent of the loss.
After the claim has been investigated, the insurer is advised of all issues involved. That includes reviewing the fidelity bond and analyzing all possible defenses. The insurer is also informed as to its potential exposure and the advisability of potential settlement. If necessary, the matter can be prepared for litigation, with an explanation of how much the likely cost may be versus resolving the claim through other means.
How Can A San Mateo Fidelity Bond Attorney Help?
The fidelity bond attorneys of Loew Law Group will conduct a thorough investigation of claimed losses arising under fidelity bonds. That includes a review of the fidelity bond to determine if there are any exclusions or defenses available to the insurance company, and to assess whether the claim is legitimate. Where needed we can turn to outside experts to provide specialized input.
Our goal is to minimize our clients’ losses while expeditiously resolving the claim. Doing so means conducting a cost-benefit analysis to determine the best strategy for the individual client. Some claims can be effectively handled using alternative dispute resolution methods. These tend to save time and money so our clients can move forward.
Of course, in some cases, litigation is necessary to protect our clients’ interests and reduce their exposure. Our attorneys have successfully handled fidelity bond matters in court and are willing and able to do so if necessary. We can also pursue subrogation against responsible third parties to help reclaim all possible amounts for our clients.
Contact Our San Mateo Fidelity Bonds Attorney
Loew Law Group has experience successfully resolving fidelity bond claims in a number of different industries. We understand the risks that these claims pose for insurers, which is why we extensively investigate them and advise the client accordingly. Give us a call today to discuss how we can serve you.