Recently, we shared some statistics from the Association of Certified Fraud Examiners (ACFE) report on fraud during the COVID-19 pandemic. While those statistics can look scary to business owners and managers, there are steps you can take to protect yourself. One of those steps is to ensure you have Employee Dishonesty Insurance. Read on for more about Employee Dishonesty Insurance including why you need it.
Updated Fraud Findings
The ACFE recently released their annual Report to the Nations and it contained some interesting data. For the purposes of this article we focused on some financial statistics, but the report contains many more informative facts and is truly a must read for business owners. Here are a few statistics to keep in mind as you read on:
- Certified Fraud Examiners (CFEs) estimate that organizations lose 5% of revenue to fraud each year
- Median loss per case: $117,000
- Average loss per case: $1,783,000
- A typical fraud case causes a loss of $8,300 per month and lasts 12 months before detection
- Organizations with the fewest employees had the highest median loss of $150,000
What is Employee Dishonesty Insurance?
In basic terms, Employee Dishonesty Insurance provides protection for your business from loss due to employee theft. The types of theft covered can include money, securities, or property. Oftentimes this coverage is part of the business’s commercial property insurance, but often policyholders don’t know what their policy covers or the nature of the coverage. For example, coverage may include the cost of investigative expenses such as accounting fees.
If you are not sure about your current coverage, the best thing to do is to reach out to your insurance company or agent and inquire about your current policy. If you are not currently covered, it may be a smart move to add some form of coverage to your plan.
Forensic Accounting and Valuation Services
At SDK our Forensic Accounting and Valuation Services department is here to help our clients in any way we can. Our team of Certified Public Accountants (CPAs), Certified Fraud Examiners (CFEs), Accredited Business Valuators (ABVs), and Certified in Financial Forensics (CFFs) will work with you to identify your company’s specific needs and bring you relevant solutions. Reach out to one of our Senior Managers, Ryan Stretmater, today with any questions at firstname.lastname@example.org or 612-332-9351.
Association of Certified Fraud Examiners. (2021) The Next Normal: Preparing for a Post-Pandemic Fraud Landscape https://www.acfe.com/covidreport-download.aspx
Association of Certified Fraud Examiners. (2022) Occupational Fraud 2022: A Report to the Nations https://acfepublic.s3.us-west-2.amazonaws.com/2022+Report+to+the+Nations.pdf