Employee Dishonesty: What are the Risks & is it Covered by Insurance?

employee dishonesty insurance coverage

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As a nonprofit or social service organization, any financial loss can be detrimental to your cause and hinder progress. It can be particularly difficult when the loss is due to employee dishonesty, since the money would likely be spent before it can be recovered. Unless your organization has specific coverage, employee dishonesty is not insured. A typical commercial insurance policy may cover litigation costs but not the actual monetary loss.

Despite careful screening, a dishonest employee may be inadvertently hired and your nonprofit or social service agency could be vulnerable to theft. Let’s look at a couple of scenarios. Your business accepts cash for transactions, and a dishonest employee takes money from the cash drawer or falsifies a transaction to make a profit. Another possible scenario could be if an employee offers discounts on merchandise to his or her friends, significantly harming your bottom line.

Unless your current policy specifically states coverage for crime-related losses, you will need to purchase another policy to supplement your commercial insurance. To protect your organization from losses due to employee theft, you can obtain a Fidelity Bond, also known as an “Employee Dishonesty Bond.” A Fidelity Bond protects your organization against theft and acts of fraud or forgery committed by a person employed by your organization. This includes check forgery, computer fraud and credit card fraud. Since the coverage is specifically a crime protection insurance, employees with a felony conviction will not likely be covered under a Fidelity policy.

Lamb Financial Group is an insurance broker that specializes in nonprofit risk management services. We invite you to call us at 866-481-5262 or use the form on our website to contact us for additional information or with any questions regarding insurance for nonprofits and social services. If you would like a quote, please fill out our online form and we will be happy to provide one.

Reducing Risk at Adult Day Care Facilities

In recent years, it seems more and more families are choosing to move elderly family members in with a relative rather than into a nursing home or assisted living facility when they can no longer live on their own. Elderly family members often still need extra assistance when relatives are at work, which has led to the increase in enrollment at adult day care facilities.

insurance for human services organizations

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Adult day care facilities can provide not only medical and health services, such as therapies and medication administration, but also social activities, meals and other events designed for senior citizens. With the variety of services an adult day care facility can offer comes a range of risks for both participants and employees. Here are some of the most common risks.

  • Choking
  • Slip, trip, and fall incidents
  • Mistakenly administering the wrong medication
  • Illness
  • Food poisoning

Like any other care facility, an adult day care facility must take all the necessary steps to reduce risk and make their facility a safe and healthy environment. This can include allowing only licensed medical personnel to administer medication or making sure all food meets certain cooking and storing standards to prevent foodborne illnesses.

Other steps may sound simple but are no less important. For example, encouraging participants and employees to diligently wash hands, especially during cold and flu season, in order to prevent the spread of illnesses. Another example is making sure foods are cut into small, easy-to-swallow pieces before serving to participants in order to reduce the risk of choking.

Adult day care facilities must do everything possible to reduce risks for participant and employee health and safety. In addition to what we’ve shared above, it’s important that your facility is backed by all the right forms of insurance, including general liability and workers’ compensation. Contact Lamb Financial Group today at 1-866-481-5262 to learn more about how we can help you find the right policies for your organization or facility’s unique risks and exposures.

Connecticut Tornadoes Remind Us to Always Be Prepared

Tornadoes definitely aren’t the norm in New England, but as recent severe weather events have proved, it can happen here just as easily as anywhere else. The National Weather Service has confirmed that an EF-1 tornado touched down in eastern Connecticut, cutting a path about 11 miles long and 100 yards wide through Andover, Coventry, and Mansfield on July 10, 2013. It was the fourth tornado in nine days.

tornado safety plans

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Fortunately, there were no injuries, NBC Connecticut confirmed. But the tornado, which caught the New Englanders off guard, left a good bit of damage behind, serving as a valuable reminder of the importance of preparedness no matter what region you live in.

Storm safety procedures should be incorporated into all company and organization emergency action plans. Below are some examples of storm safety steps that could be incorporated into plans in order to ensure the safety of employees during severe weather conditions.

  • Make sure everyone knows the difference between a tornado watch and a tornado warning. A watch means conditions are favorable for a tornado to develop. A warning, as described by OSHA, means “severe weather is present, there is imminent danger for people in the warning area.” When a warning is issued, everyone should take cover immediately.


  • Use a special weather radio, such as a NOAA all-hazard radio, to stay aware of watches and warnings issued for your area when severe weather has been predicted.


  • Designate tornado shelters in your building and make sure they are posted in very visible locations, such as with the fire escape routes. Tornado shelters should be away from outside walls, glass windows and doors. Ideal locations are basements, enclosed areas in the middle of the building, or interior stairwells.


  • If your employees travel, include plans for what to do if they are driving when severe weather hits. Employees should ideally get off the road and seek shelter inside a sturdy building. However, they can take cover by laying face-down on low ground if they are not able to take shelter indoors.


You should also include points in your tornado safety plan such as how to safely evacuate after the storm passes and what to do in the aftermath, such as assigning someone to contact emergency personnel and another to provide aid until help arrives.

Is your organization prepared for a weather emergency? Do your employees know what to do and where to go? In addition to our insurance offerings, Lamb Financial Group can also help your organization form a safety committee and create a safety policy. Contact us to learn how we can help you be prepared for anything.