US businesses buying commercial crime insurance need to separate employee theft from a payment that an employee authorises after deception. Compare actual insuring agreements, exclusions and endorsements for each event. A marketing reference to fraud or social engineering is not a promise that either loss will be paid.
Compare two current procurement routes
Sompo commercial crime proposals
Sompo’s commercial crime sheet describes internal and external theft protection and lists social-engineering coverage among its enhancements.[1] It does not supply enough wording to establish how a deceived but authorised transfer would be treated in an individual quotation. Ask for the applicable form, endorsement, limit and conditions.
Chubb social-engineering endorsement
Chubb’s US page describes social-engineering protection available by endorsement to a crime policy, including a carve-back addressing voluntary parting.[2] This makes it a relevant wording-comparison route for induced transfers. It does not establish automatic cover under every Chubb policy or another insurer’s form; the issued endorsement and schedule must confirm the purchased terms.
These are examples of currently marketed routes, not a market-wide ranking or matched quotations. No premium, claim-payment rate or superior coverage outcome has been independently established here. Historical government crime-insurance records are not present-day purchase alternatives.
Use two explicitly hypothetical loss scenarios
Employee theft: a payroll employee creates a fictitious vendor and diverts money for personal gain. Ask who qualifies as an employee, what property is insured, and how discovery, prior knowledge, collusion and the selected insuring agreement affect the response.
Deceptive authorised transfer: someone impersonates a supplier; an employee approves a transfer to the impostor’s account. Ask whether the policy treats voluntary authorisation differently from unauthorised computer intrusion and whether a social-engineering endorsement changes that result.
These invented scenarios are questions for the insurer or licensed adviser, not examples of completed claims. Change them to reflect the actual business process, including contractors, payment approvals, verification steps and communication channels.
Require a clause-level written response
- Cover trigger: identify the insuring agreement, definitions and exact policy and endorsement form numbers.
- Exclusions: ask how voluntary-parting, authorised-transfer, computer-fraud and other relevant provisions apply to each submitted scenario.
- Conditions: identify callback, dual-authorisation or other verification requirements and the consequence of failing them.
- Limits: compare the main limit, social-engineering sublimit, retention, aggregation rules and any relevant annual cap.
- Timing: check discovery and reporting provisions, prior knowledge, policy dates and any post-cancellation discovery terms.
- Coordination: ask how the crime and cyber policies allocate an overlapping loss; do not assume both pay.
Ask the adviser to identify unanswered clauses rather than inferring protection from a product name. Request the full proposed wording, declarations and endorsement schedule before binding, and reconcile them with the issued documents.
Keep prevention and insurance separate
Approval and verification controls are operational safeguards, not a substitute for policy cover. Insurance likewise does not remove the need for controls. Preserve how the actual payment process works and disclose material information accurately; do not redesign a loss description to make it look covered.
When a proposed endorsement addresses an exclusion, check its scope and exceptions rather than assuming it removes every fraud limitation. Chubb’s description applies to its advertised endorsement; Sompo’s brief public description does not establish identical wording.[1][2]
Normalise US quotations
Use the same entities, exposure information, desired limits, payment workflows and hypothetical events for each proposal. Compare USD premium, taxes, fees, retention, endorsements, territorial scope, policy period and claims-notification responsibilities. Ask about state availability and placement status where relevant. This guide establishes no binding quote or nationwide eligibility rule.
A lower premium may accompany a different limit or a narrower endorsement. Record which conditions differ and what remains unresolved. Obtain a licensed insurance professional’s review of the operative wording; request written confirmation within the authorised placement documents rather than relying on marketing, a sales email or an unqualified promise of claim payment.
References
- Commercial Crime Insurance Coverage (sompo.com)
- Chubb US: Social Engineering Fraud Insurance (chubb.com)
