What is a Fidelity Bond?
A fidelity bond is one of the oldest uses of bond in the world. A fidelity bond is simply an agreement for one party (the surety) to provide assurance to another party that the person being guaranteed will live up to the terms of the agreement. Fidelity bonds are usually personal in nature.
A fidelity bond is a type of surety bond (similar to insurance), which provides protection for the Obligee for any losses that are incurred due to an employee (or specified third party) committing a fraudulent act. These bonds are also referred to as dishonest employee act bonds.
Fidelity Bond Quotes
To get a Fidelity Bond, just click on the Apply Online image below. Choose your state and then the type of bond you need.
Protecting your business against employee theft
Similar to insurance policies, a fidelity bond is really a type of surety bond. These protect employers from the dishonest acts of employees, like insurance would. The losses that are usually protected against are losses from company securities, funds, as well as other property losses from an employee through theft or fraud. Certain employees have access to funds and employers want to protect against losses from those employees. The simplest example is a bank teller. Given that they have access to plenty of cash, an employer is unable to fully monitor the actions of the employee. So, the employer will get a fidelity bond to protect against this potential loss.
Fidelity Bonds Guide
The most common type of a fidelity bond is a first-party bond. This type of bond protects your business against intentional bad acts, such as theft, fraud, forgery and other intentional acts that are committed during the employment process. The other type of common fidelity bond is a third-party bond. These bonds are protection for the business for people that work for them on a non-employment basis, such as independent contractors or consultants.
Fidelity and Surety Bonds: Do You Need Them in Your Business?
Business that are in banking and financial fields usually require all of their independent contractors or consultants to carry third party fidelity bond coverage to help protect the business through losses from theft or fraud. It’s the responsibility of a business to protect itself and, thus, that is why they require third parties to have a fidelity surety bond. The third party is then tasked to go obtain the bond (you can get one by clicking the apply button above).