Employee Fidelity Coverage – A Personal Account

Hale Stewart

I recently had a client place family heirlooms with a service. Unfortunately, these were stolen while in the service’s possession. The items were not only valuable from a monetary perspective but also in a sentimental sense. And, it’s highly doubtful they will ever be found.

This experience reminded me once again about employee fidelity coverage and captive insurance. While commercial coverage is available, it’s important to note that insurance companies have several strong arguments at their disposal to deny a claim. In contrast, captive policies can be written to prevent the captive from asserting these claims thereby giving the insured broader coverage in the event of loss.

To get an idea of the costs related to theft, consider these statistics contained in this link from the Association of Certified Fraud Examiners.

Mr. Stewart has a masters in both domestic (US) and international taxation from the Thomas Jefferson School of Law where he graduated magna cum laude. Is currently working on his doctoral dissertation. He has written a book titled US Captive Insurance Law, which is the leading text in this area.

He forms and manages captive insurance companies and helps clients in international tax matters, US entity structuring, estate planning and asset protection.

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