COVERING THE ASSOCIATION’S MONEY

Protecting your association means protecting your association’s money too. No one expects to vote a money laundering swindler onto the board or into office for that matter. Yet, we both know this occurs and those who don’t have the default built in limit adjusted to fit the needs of the association get hit hard, that money is gone forever, never to be recovered. Coverage for criminal acts and acts of dishonesty are a sad necessity.

To protect your association make sure you have at least a limit equal to your operating account + reserve account + three months assessments. This rule of thumb will help get you pretty close to exactly what you need. 

You may come across three types of policies; Fidelity Bond, Employee Dishonesty & Crime. These policies do NOT provide coverage for accounting mistakes or loss of money due to poor work performance. It does NOT cover for losses due to the normal operations, or interruption of operations of the organization. What does do?

Fidelity Bond covers dishonest acts of employees and will provide coverage to an organization for financial loss of money, securities, and other property due to fraudulent activities of one or more employees. And is a stand alone or additional policy.

Employee Dishonesty is generally included in standard package property policy and it deals with loss of money and securities from dishonest acts of employees

Crime is the broadest form of this class of coverage as it covers dishonest acts and extends to include coverage for theft, depositors forgery, loss of money orders, and losses arising out of counterfeit paper currency.

***Word of Caution some policies exclude the property manager. Be sure to request a policy that extends to cover your property manager. ***