The Risk

Companies around the world are at risk of criminal activity and can suffer huge losses. Beyond the financial damage and impact on profitability, firms are likely to be affected by loss of competitive advantage, business interruption, negative publicity/harm to reputation and poor staff morale. In the worst case, organisations both large and small may face the risk of bankruptcy.

The scale of commercial crime

  • Across Europe, 43% of larger companies have been the victims of economic, crime in last two years.
  • Some 85% of the worst frauds worldwide in the last two years were committed by insiders. Half of those were committed by managers, half of whom had spent less than a year in that new management position.
  • The average cost of fraud is estimated to be Euro 6.7 million per organisation that was able to quantify its losses.
  • Insiders rely on their knowledge of a company's systems and controls, not only to practise deceit, but also to cover their tracks.As a result, internal thefts can go undetected for several years.
  • Many organisations do not insure against economic crime even though the probability of its occur¬rence is high. As a result, 49% of frauds are not recovered.
  • 45% of 3,634 companies surveyed worldwide have fallen victim to economic crime in the past two years- an 8% increase from pevious survey.
  • There has been a 71% increase in the number reporting corruption & bribery, a 133% increase in the number reporting money laundering, and a 140% increase in the number reporting financial misrepresentation since 2003
  • No industry is safe – whether regulated or unregulated. From 38% to 60% of the companies in each of the sectors reported significant frauds.
  • In the past two years, the average financial damage to companies from tangible frauds (i.e., asset misappropriation, false pretences, and counterfeiting) was US$ 1.7 million.

The Solution

Howden India is committed to assisting you to identify your exposures and to transfer risk. As a focused and highly experienced team, we represent an increasing number of clients from across the commercial spectrum; from the large and high profile to small and specialist enterprises. Either way, each client is unique.

While the majority of crime losses are caused by employees, we provide comprehensive protection for a company's assets against both employee and third party crime. This requires a professional programme of loss prevention, a broad policy and a history of successful claims negotiation.

The Cover

Howden India works with the insurers to provide tailored wording to provide optimum protection against commer­cial crime.

Our protection offers the following benefits:

  • No requirement to identify the employee involved in the crime
  • No requirement to prove that the perpetrator had manifest or clear intent to defraud the insured
  • No requirement to prove that the perpetrator gained personally from the crime
  • Cover for losses discovered during the policy period irrespective of when the crime occurred
  • Cover for losses sustained by a client
  • Cover for loss of money and securities caused by a third party
  • Cover for expenses, including interest due and not received, or contractual penalties incurred as a result of suffering a crime
  • Cover for theft from a company's pension schemes and other employee benefit plans worldwide
  • Automatic cover for new companies included at no additional premium (subject to size)
  • Cover for expenses caused by a computer violation
  • Cover for expenses to investigate loss
  • Cover for losses caused by actual destruction, disappearance, abstraction of money outside the premises.

Broad definition of employee includes:

  • Ex-employees up to 60 days after termination of employment
  • Trustees, fiduciaries, administrators
  • Directors or officers of the insured
  • Temporary staff, students and secondees