Business owners in Texas need commercial crime insurance to protect themselves from financial losses resulting from robbery, fraud, forgery, theft, and burglary. When buying commercial crime insurance (or business crime insurance), it's important to assess the company to know what kind of coverage is needed. The amount of business crime coverage required is determined by the company size and the number of employees on the company’s payroll. Also, an entrepreneur may want to purchase standalone commercial crime insurance or include it as an endorsement in a general business owner's policy (BOP).
Generally, comprehensive insurance policies are better options for entrepreneurs whose businesses are vulnerable to crime-related liabilities. Other factors to consider before deciding on the coverage policy to purchase are the business type, structure, and engagement with third parties. In addition, selecting a coverage amount that can get your business back to its initial state before the financial loss is important.
The best way to buy commercial crime insurance is by employing the services of a Texas-licensed business insurance agent. Collaborating with a knowledgeable agent in Texas will ensure that the company and local crime concerns are covered within the policy. Business owners in Texas can work with independent or captive insurance agents. In Texas, a captive agent only sells insurance products offered by the company they represent. On the other hand, an independent agent provides a wider range of insurance solutions since they represent multiple insurers. Qualified commercial insurance agents who work with business crime insurance providers can help you get commercial crime insurance with less worry and time.
Yes, commercial crime insurance coverage is necessary for companies that have part-time employees, have movable goods or items, and allow staff access to financial documents or client data. Many small and medium-sized firms, particularly those with insufficient means to invest in costly security measures, need commercial crime coverage insurance. Cashiers, check cashers, credit card cashiers, and internet payment cashiers are exposed to multiple frauds. A crime report published by the Texas Department of Public Safety (DPS) revealed that properties worth more than $2 billion were stolen between 2019 and 2020 in Texas. According to the report, the value of office equipment stolen during that period was over $54 million.
Keep in mind that business property insurance plans do not cover employee-committed crimes. Also, third-party crimes are often only covered to a limited extent. Even though new technology enables individuals to work more effectively and better, fraudulent employees are becoming smarter and faster.
Apart from this, personnel theft and fraud threaten the financial stability of all firms. Even with pre-employment screening and other security controls, you may never be certain that you are completely protected. Small firms are more vulnerable to employee-committed crimes like fraud and embezzlement. Even a minor cash theft might have a detrimental impact on a business, especially on a small business with limited operational cash reserves. Commercial crime insurance can protect a company from the financial consequences of theft, dishonesty, and fraud perpetrated by a single worker or a group of personnel.
Before buying commercial crime insurance in Texas, you must contact a knowledgeable business insurance agent to help you assess your business needs and understand the amount of coverage necessary for the company. Here are three steps to take if you are about to shop for business crime insurance.
Understand all about business crime insurance: With the help of a licensed commercial insurance agent in Texas, you can find out if you need to add commercial crime insurance as an endorsement to your policy or buy standalone coverage. It is also important to learn about the insurance premium, deductibles, and how to reduce the cost of commercial crime insurance. Factors influencing the cost include the coverage term, exemptions, limit, deductibles, and company size. The business' revenue, employees, and risk management efficiency will also help determine the premium cost.
Understand what is not covered under business crime insurance: While commercial crime insurance covers illegal activities performed by staff, it does not insure against criminal activities carried out by the business owners and their partners. It also does not cover inaccuracies such as accounting irregularities and your liability in the event of another party's criminal losses. For example, suppose you hire an information technology (IT) expert whose actions lead to a cyber attack. In that case, commercial crime insurance will not compensate you for financial losses caused by that error.
Compare multiple quotes: Comparing quotes from several insurers will help you find low-cost business crime insurance that meets your needs. It is preferable to use the services of an independent insurance agent to compare quotes from different insurers.
Below are some commercial crime coverage insurance options available to cover financial losses involving employee-related crimes and crimes committed by third parties in Texas.
Worker dishonesty coverage: This can cause financial loss, security breach, and property damage to a business. However, if the business owner (the insured) knows that a worker has repeatedly stolen from the company, the damages may not be reimbursed.
Alteration or falsification: If someone forges checks, promissory agreements, or other commitments to make payments drawn on a business account, commercial crime insurance will pay the damages. According to the Association of Certified Fraud Examiners, a typical corporation risks losing close to 5% of its sales to fraud every year. The reports show that losses related to employee dishonesty range from hundreds of thousands to millions of dollars. This insurance will also cover legal expenses incurred in defending against litigation if you are charged in court for declining to pay for a fraudulent check or loan agreement.
Asset or Cash Theft: Business crime insurance (also known as Employee Theft Insurance) will pay for cash or asset theft committed by employees and non-employees. Damages done to the company's vault, closed safe, or cash register due to attempted theft will also be covered under this insurance. Exclusions under asset or cash theft coverage include goods that are not within the business premises or goods that are not the company's assets.
Robbery or Theft Outside the Building: This coverage includes the theft, loss, or damage of money, commodities, or other property when it is beyond the business premises and in the custody of a messenger or armored vehicle firm. This mostly relates to property in transit.
Cyber fraud: Losses or damage occurring from the illegal movement of your business’s funds, securities, or other property to a location other than your business premises or bank as a consequence of the use of a computer.
Fraudulent fund transfers: Losses caused by false instructions sent to a banking institution, causing them to move cash from the business account.
Money orders and forged currency: Losses incurred due to accepting phony money orders or fake money.
A business can qualify for commercial crime insurance if the business:
Is a registered business in Texas;
Uses payment gateways (online payment and credit cards) that are prone to fraudulent fund transfers;
Employs part-time or full-time workers;
Owns goods that can easily be removed from the premises; or
Allows employees to handle customer or financial information
Although the Texas Insurance Code does not mandate business crime insurance, the company is liable for any financial losses and liabilities resulting from employee and third-party frauds. As such, it is important to contact a commercial insurance agent in Texas to discuss your business needs and determine what your business needs to qualify for commercial crime insurance.
You can buy commercial crime insurance from regular insurance providers in the Texas insurance market by shopping around yourself, asking friends, or checking online for different insurance quotes. However, these options often lead to disadvantages, such as over-insurance and high premium costs. The ideal way to buy business crime coverage is through an insurance agent registered by the Texas Department of Insurance (TDI). A good Texas-licensed business insurance agent can assess your business needs and advise you on the best commercial crime coverage plan that suits you while also helping you shop around for affordable and suitable quotes. A Texas-licensed insurance agent will guide you through the application process to avoid unnecessary errors.
You can get commercial crime insurance through your current insurance agent. However, if you don't have a knowledgeable Texas-licensed commercial insurance agent, you can use the agent lookup tool the Texas Department of Insurance provides. This online resource can also be used to verify an agent’s license. If you are unsatisfied with the online agents, you can ask your business partners for recommendations.
While searching for commercial crime insurance quotes online may appear simple, you should never make your decision without first consulting a Texas-licensed business insurance agent. This is because most online insurance quotes do not quote an actual premium cost. The quote is usually pending the final underwriting, which can eventually change the final price. While dealing with a knowledgeable agent from the start, you get the already approved cost. A Texas-licensed commercial insurance agent can help you understand what is and is not included in the policy.
A knowledgeable Texas-licensed business insurance agent can help you buy affordable commercial crime insurance by evaluating the business to determine how much insurance will cover the risks associated with your business. Then, the agent will get different quotes from multiple insurance companies. With multiple insurance quotes, finding an affordable coverage plan that suits the business needs will be easier. Generally, insurance providers in Texas offer commercial crime insurance at different costs, based on several factors such as the size of the business, the number of employees, and the risk unique to the business’s location. Your agent can also help you bundle business policies with your commercial crime insurance to obtain a discount from the insurer.
To apply for commercial crime insurance in Texas, contact a state-licensed business insurance agent who can help you look for suitable insurance products from a provider (captive agent) or multiple providers (independent agent). An insurance agent can also simplify the application process by explaining everything about the coverage. Afterward, you will need to provide the following information:
General information: Here, the business representative fills in the company’s name, contact details, location, nature of business, description, and date of establishment.
Type of commercial insurance coverage: This section also contains the coverage amount, deductible for each coverage, and policy term.
Company's employee information: This section contains questions on the company's payroll, the number of employees living within and outside Texas, and volunteers.
Company's financial information: Under this section, applicants specify information such as the business's net income, physical assets, and revenue.
Company's business controls: Here, the applicant business answers questions about the security practices. This includes the organization's hiring process and ethics policies.
Note that the information provided in each section will be used to determine the business’s insurance coverage and premium. As such, it is advisable to consult with a Texas-licensed business insurance agent to avoid making errors that will affect the company’s coverage plan. Before your business’s commercial crime coverage insurance kicks off, you will be required to pay the associated premium costs.
Searching online is another way to apply for commercial crime insurance. When you see an offer that interests you, submit an online quote request. After submission, the business insurance agent representing the Texas insurer you registered with will contact you to finalize the agreement. It is advisable to have your insurance agent review the online quote you are considering before you go ahead with it.
You can seek assistance from a knowledgeable Texas-licensed commercial insurance agent to assist you with the application process. Filling out insurance applications without professional help can lead to costly errors like errors in coverage limit, deductible, and coverage plan, which can affect the premium price, coverage, and claims payment. Only a licensed commercial insurance agent is legally allowed to evaluate the coverage needs and provide professional advice.
Yes, it is wise to use an insurance agent to buy commercial crime insurance. Although it is possible to find different information about commercial crime insurance online, you may make errors if you buy a coverage plan without the help of a Texas-licensed professional. Agents work directly with Texas insurers to get the best and cheapest coverage that meets your insurance needs. You should use a business insurance agent when comparing different quotes and applying for a coverage plan.
Yes, you can buy commercial crime insurance by seeking the help of a Texas-licensed business insurance agent. However, you should also understand how the insurance agent operates. For instance, a commercial insurance agent in Texas can operate as an independent agent representing multiple Texas insurers or as a captive agent representing one insurance company.
Using a Texas-licensed business insurance agent streamlines the process of selecting business crime insurance. There are several commercial crime coverage plans, each with requirements, protection, and exemptions. As a result, it might be difficult to determine which types and levels of coverage are appropriate for your business size and revenue. This is where insurance agents come in. First, the agent examines the size of your business, number of employees, security architecture, and local crime risks. Afterward, the business insurance agent helps you look for the best insurance quotes and the discounts offered by the insurance providers. You can also count on a knowledgeable agent to provide answers to any questions regarding the policy’s terms and conditions. And when it is time to file a claim, a commercial insurance agent will make the claim process stress-free.
An insurance agent is essential for business crime insurance in Texas because they ensure that the coverage type and limits fulfill the insured business' demands. Purchasing too much insurance results in higher premiums, but not having enough protection might result in out-of-pocket payments even when you believe you were fully insured. However, with a business insurance agent, the issue of over-insurance or under-insurance will be eliminated.
The right insurance agent that can help you with commercial crime insurance in Texas is an agent with a vast understanding of how business insurance works. Their knowledge can help you decide the kind of business crime insurance that will fit your business needs. These insurance agents may be independent agents or captive agents.
Generally, independent agents in Texas are not limited to dealing with a single insurance provider. Because of their large network of insurers, they typically provide a wider variety of policies. Furthermore, independent agents can quote and offer insurance products to the companies they represent.
On the other hand, a captive agent operates as a full-time worker for a single insurance company. Because a captive agent works primarily for a single insurer, they often have an extensive understanding of the insurance policies of the companies they represent and are well-positioned to deliver reliable advice to clients. Nevertheless, they are frequently unaware of various policies available in the competitive insurance industry. Captive agents frequently receive operational support from the insurance firms they represent and information on possible clients.
Corporate entities must carefully choose their commercial crime insurance agents. Here are some important factors to consider when choosing an insurance agent.
Type of Agent: The two main types of insurance agents in Texas are independent and captive agents. While captive agents can only provide coverage plans from one insurance provider, independent agents will offer several business crime insurance quotes. Generally, independent agents are seen as a better choice for comparing a variety of coverages since they represent different Texas insurers and have a broad knowledge of business insurance.
Location: Where the insurance agent operates is very important when choosing an agent. This is because a local business insurance agent knows more about the business crime risks your area is exposed to. With this knowledge, the agent will provide your business with suitable commercial crime insurance policies that meet your business needs. Additionally, if you use the local agent, you always have a friendly local professional who can help you with filing claims, update coverage, or just to communicate with the insurer on your behalf.
License and Knowledge: You can verify whether a commercial insurance agent has a valid license from the Texas Department of Insurance (TDI). To do this, click on the license lookup section on TDI’s website. Business owners can also verify the insurance agent’s by reading reviews and testimonials from previous clients. They can ask basic business crime insurance questions to see how informed the agent is.
The insurance agent you choose should provide you with multiple insurance quotes to make it easier for you to spot the right coverage plan. However, if you have an insurance company you wish to buy from, the captive agent from that company should have an in-depth knowledge of all the types of business crime insurance products offered by your preferred company. Generally, it is easier to locate a knowledgeable captive agent since they receive extensive training on their lineup of commercial insurance products. However, you will only be limited to the coverage plans marketed by the agent’s employer.
In general, it is important that the agent (captive or independent) should understand the local risks associated with your business and help with security solutions that may cut down the cost of your business crime insurance policy. However, the most important criterion is ensuring that the agent is licensed in Texas.
An entrepreneur or small business owner in Texas can find a proficient Texas-licensed commercial crime insurance agent by asking for recommendations from business owners in their industry who own active business insurance policies. However, after such recommendations, business owners still should ask for testimonials to ascertain the agent’s proficiency.
After studying reviews or testimonials, you will learn how an agent operates and communicates. You can find out how knowledgeable a prospective Texas-licensed agent is by asking questions related to business crime insurance. Ask about the average premium cost for insuring your business from commercial crime and the insurance providers they represent. The last and most crucial step in finding a proficient insurance agent is performing a license lookup through the TDI website.
A licensed business insurance agent in Texas can help businesses:
Find multiple insurance quotes from different insurance providers they represent
Calculate premium price according to the coverage amount and deductible selected
With professional information, advice, and answers related to commercial crime insurance
Customize a business crime insurance policy to suit their unique needs
Ensure that all policy requirements are met, including submitting the necessary forms
Fill out insurance applications and serve as a liaison between the consumer and the insurance provider
Keep track of and resolve all commercial crime-related insurance claims
Conduct an annual review of the insurance needs. If any adjustments are needed - suggest options and help filing the necessary paperwork to effect the needed change.
Your Texas-licensed insurance agent should help assess the risk associated with the business, then help you get quotes from different insurance providers. An agent will simplify the application procedure and offer advice on upgrading your company's security. A business owner should provide the commercial insurance agent with necessary details like the company's revenue, number of employees, security framework, and company budget. This information will assist your insurance agent in determining the right coverage amount suitable for your business organization. In addition, independent insurance agents can help your organization find cost-effective commercial crime insurance policies and discounts. After helping you secure an insurance policy for your business, your insurance agent will explain the contract terms of the insurance policy that seem difficult to understand.
The ultimate goal of comparing commercial crime insurance quotes is to get an affordable commercial insurance policy. Here are some basic ways to achieve this goal:
Request quotes from trusted insurance providers in Texas: Once you determine the business crime coverage type and amount, the next step is to request quotes from at least three insurance providers.
Don't just compare the insurance rates: Small businesses on a limited budget may be tempted to make a purchase decision based simply on the premium cost rather than concentrating on the optimum coverage for their company. Before choosing the cheapest coverage plan available, remember that you are obtaining the business crime insurance plan to limit the chances of financial loss. If an insurance company's coverage is less expensive than others, there's a reason. You should find out this reason and decide if it is important to your company's needs or not.
Find out what is covered and not covered: Don't think the coverage offered in each quote is similar, regardless of the type of business crime insurance you're looking at. This is to avoid buying insurance, only to realize later that it doesn't provide the coverage required when it's time to submit a claim. Every policy will specify the occurrences that will and will not be covered and the inclusions and limitations.
Compare deductibles: High deductibles often reduce the cost of insurance premiums. However, this may be risky for small business owners with limited financial capacity to pay out of pocket before the insurance coverage kicks in. Remember that an insurance provider will not pay a claim until the insured can satisfy the deductible.
It is advisable to seek guidance from your insurance agent when comparing commercial insurance companies. Knowledgeable Texas-licensed insurance agents help business owners identify their company's most important insurance needs and make better judgments while comparing different insurance quotes. They also have access to multiple insurance providers and can help business owners easily get several quotes that are tailored to their business needs.
Corporate entities in Texas should compare more than three business insurance quotes from different insurers to find the most suitable policies for their businesses and save money.
Entrepreneurs need to obtain as many business insurance quotes as possible, which will give them an idea of the average coverage amount in the market. There is always a significant difference in the quotes provided by various business insurance providers because each Texas insurer has a unique risk analysis method. Therefore, comparing at least three quotes will provide leverage during price negotiations.
A local insurance agent in Texas will probably work in an area close to your business location. These local agents understand the business risks unique to the area and can provide the best commercial crime insurance options that fit the bill. In addition, since local agents work close by, they are always available to help with the claims filing process and answer questions related to business crime insurance. This is important when a commercial crime occurs and you need to submit a claim.
No, your organization is not required to pay for a Texas-licensed insurance agent’s service. Every insurance agent represents a company that pays them commissions or salaries, depending on the type of insurance agent.
A commercial crime insurance agent in Texas gets paid by the insurance companies they represent. As such, you are not required to pay for their services. Insurance agents’ pay depends on whether they are independent or captive agents. For instance, an independent agent representing different providers earns commissions from each insurance firm. The commissions earned are percentages of each insurance product sold to clients. Typically, commissions are higher when a client initially purchases a business crime policy, but the amount drops dramatically after each renewal.
On the other hand, the insurance company that employs captive commercial crime insurance agents pays them a basic salary. In addition to the basic wage, some insurance companies pay captive agents a portion of the commission based on sales success. Furthermore, some insurance firms reward their captive agents with incentives when they accomplish certain sales targets.
Several insurers providing business crime insurance in Texas allow business owners to initiate the process of purchasing coverage online. While it is possible to send some paperwork over the internet, business owners should also speak with Texas-licensed business insurance agents in person before closing deals. In this case, an agent will be responsible for assessing the business’s size and criminal vulnerabilities. Also, the agent will ensure that there are no errors in getting the quotes and that clients purchase just the right coverage.
Yes, anyone who owns a business and can pay the cost of insurance coverage can get a commercial crime policy in Texas.
Yes, corporate organizations can purchase commercial crime insurance anytime once they contact a licensed insurance agent. However, the idea of time comes into place when deciding between two aspects of commercial crime coverage: discovery coverage and loss sustained coverage. Discovery coverage will protect your business against losses found during the policy term. Although the crime may have occurred before you purchased the commercial crime insurance, your insurer will still pay for it as long as it was discovered during the policy period. Meanwhile, the loss sustained coverage only applies to losses that occur and are detected during the policy term. Under this coverage plan, business owners are offered a one-year extension for the discovery of criminal losses which took place within the policy term.
Over-insurance occurs when the amount paid for business crime insurance is more than any financial losses the company may suffer due to commercial crime within the policy period. This can occur if a business owner pays an insurance premium to cover risks the business is not exposed to or the coverage amount purchased significantly exceeds the company’s actual value. To avoid wasting financial resources through over-insurance, business owners should always perform an insurance risk assessment and annual audit of their investments and liabilities with their trusted and experienced insurance agents.
Your business may suffer financial setbacks due to paying unnecessarily high premiums caused by over-insurance. Also, premiums paid for additional coverages that are not necessary may never be paid out by the insurance provider. Moreover, business owners who over-insure could have made business profits if they had invested the money in other ventures. Therefore, getting only the coverage required to suit the company's risk is advisable to avoid waste of resources.
Although the decision to over-insure your company is solely on you, it is important to consider the business's financial capacities before doing so. Generally, a knowledgeable insurance agent in Texas with proper information on how overinsuring affects businesses can help you make a well-informed decision on over-insurance.
No. Buying too much commercial crime insurance is a form of financial mismanagement that can negatively affect a business. Over-insuring a business against commercial crime may not be a problem if the company is located in crime-prone Texas cities like Dallas, Houston, and Fort Worth. The risk profile of businesses in crime-prone areas is usually high, so paying for more coverage may be ideal. However, paying for additional business crime insurance is not smart when the company's risk profile is low.
Generally, Texas insurers send renewal notices to insureds by email or post before their commercial crime insurance policy ends. The notice explains the insured's existing premiums and the specifics of a policy change (if any), including new pricing. Here are some steps to take when renewing your commercial crime insurance:
Contact your Texas-licensed business insurance agent to discuss the renewal notice sent by your insurer
Review your business’s risks with your insurance agent to decide whether you need more coverage
Make a decision to renew the commercial crime insurance by paying the new premium rate.
Some Texas insurers may roll over the policy automatically at expiration if policyholders do not respond to the renewal notice. Automatic policy renewal without reviewing it with a licensed insurance agent can lead to over-insuring or under-insuring. It is critical for business crime insurance coverage to match a company's changing demands.
Generally, business crime insurance covers losses related to employee dishonesty, forgery, computer fraud, and money transfer fraud. However, as a crime insurance form, policyholders can choose between discovery or loss-sustained coverage form. Commercial crime insurance written as discovery coverage will only pay for crime-related losses found during the policy period regardless of when the crime occurred. On the other hand, a loss-sustained coverage will pay for losses that occurred and were found within the policy term.
Loss-sustained coverage often includes an extended period for crimes that occurred within the policy term but were discovered later. However, most business owners consider discovery coverage a better choice since it can cover losses from crimes that may have occurred years before buying commercial crime insurance. While existing companies with a history of fraudulent activities may choose discovery coverage forms, new business owners with part-time workers find loss-sustained coverage forms a good alternative.
Only a licensed Texas commercial insurance agent can give a professional assessment of what commercial crime insurance coverage is best suited for a particular business.
The kind of business crime insurance available to corporate organizations or small businesses in Texas include:
Employee dishonesty policy: This would compensate for any damage or loss to funds, securities, or other assets caused by untrustworthy employees
Alteration or forgery policy: This type of employee dishonesty focuses on losses related to forging checks or agreements
Computer fraud policy: This would cover computer-related fraud by employees or non-employees
Money transfer fraud policy: This would cover losses caused by fake online money transfer instructions issued to the policyholder’s bank on false pretenses
Social engineering fraud: This is commonly referred to as impersonation fraud or corporate email hack. This policy covers losses incurred from an employee being deceived into wiring company funds to fraudsters
Yes. You can bundle a commercial crime policy with commercial car insurance to save money as a multi policy discount. Commercial auto insurance is a separate business policy for companies that use their cars for business activities like visiting clients, transporting goods, equipment, and supplies, or driving to work locations.
Keeping track of many business insurance plans is challenging for business owners. As a result, combining numerous policies with the same insurance provider streamlines recordkeeping. Aside from having fewer expenses to remember each month, having the bundled insurance renewed at the same time annually makes the reviewing process easy.
Business owners in Texas who fail to pay premiums when due or forget to renew their commercial crime insurance may get a business insurance lapse (terminated policy). Here are three ways to reinstate your commercial crime policy.
Generally, the policy document or product disclosure statement will contain information on the type of commercial crime insurance purchased. Contact your regular insurance agent to explain the content of the policy document.
Throughout the process of purchasing commercial crime insurance, business owners always work with insurance agents in person and over the phone. As such, you will always find out about your business crime insurance. If you don't understand some technical terms within the policy document, an insurance agent can provide answers to questions regarding the coverage.
A commercial crime insurance policy cannot be concealed from the business owner. However, the best way to find out about the existence of your commercial crime insurance is to contact your company's insurance agent.
Yes. Combining business crime insurance with other business insurance packages, such as commercial property insurance, with the same insurer may help you save money. Furthermore, bundling business insurance policies may qualify the policyholder for discounts.
Yes, purchasing commercial crime insurance is a good deal, especially for large companies that allow employees access to the company's financial records and assets. Although Texas law does not mandate business crime insurance, entrepreneurs will be liable for all financial losses resulting from employee dishonesty or robbery. Additionally, with commercial crime insurance, companies will continue to find new ways to improve the security framework, which will help them pay lower insurance premiums.
Discuss your commercial crime insurance needs with a licensed Texas commercial insurance agent who has experience with your type of business and can suggest options of coverage from multiple sources, bundles in various ways.