Providing coverage against fraud and crime-related losses - Takaful
Bankers Blanket Bond is an umbrella cover usually offered to Banks to cover their operational risks thus providing coverage against fraud and crime-related losses arising out of either one or more of the following:
What it covers:
- If the employee of the bank commits fraud and result in loss to the bank and for personal gain to the employee.
- Loss of Property i.e. cash and valuables etc. (property is also described in the PMD in detail) of the Participant and of the customers at the premises of the Participant due to robbery or armed hold-up.
- Loss of Property i.e. cash and valuables etc. (property is also described in the PMD in detail) possessed by the Particpant’s authorized employee as custodian during transit.
- Losses associated with the forgery or fraudulent alteration of financial instruments meant for withdrawal or payment of funds.
- Losses associated with acceptance of counterfeit currency.
- Damage to facilities, furniture, fixture etc. caused by the acts of robbery or attempted robbery. This benefit is often covered by way of a separate comprehensive policy.
- Losses associated with false, fraudulently altered, lost or stolen securities.
It in general covers following clauses:
Infidelity of Employees
- It covers dishonest acts of the employees of the participant with the malicious intent to have improper financial gain whether done alone or in collusion including loss of property.
- Salary, fees, commission, promotion, increase in salary does not mean improper financial gain.
On Premises
- This clause covers the loss of property particularly cash while on bank’s premises by way of burglary, robbery, forced deprivation or armed hold-up.
- It also covers the loss of property, particularly cash, while in the possession of the customer due to burglary, robbery, armed hold or forced deprivation when such customer is on Bank’s Premises.
In-Transit
- It covers loss of property while in transit and in the custody of the Bank’s employee.
- In case the transit is being carried out by the Professional Security or Armored Vehicle Company then in case of loss, only excess amount shall be paid which is in excess to the amount recoverable from such armored vehicle company subject to their agreement with the bank.
Forged Cheques
The coverage is against the loss sustained by the Bank by honoring any cheque or financial instrument that is:
- Forged or fraudulently altered by any one with the manifest intent.
- Forged as to the signature i.e. the instrument bearing the forged signature or signature being fraudulently altered.
Counterfeited Currency
- Any loss sustained due to the receipt or issuance by the participant of any counterfeited paper notes or coins
Damage to Offices & Contents
- Any loss sustained to the fixtures, furniture and fittings situated in the Premises where robbery, burglary and or attempt to burglary has been made leading to loss and damages due to the said perils.
Securities et al
- By reason of the participant having, in good faith and in the ordinary course of business, acted upon securities or written as defined in the PMD, which proves to have been forged, fraudulently altered, lost and or stolen
Other relevant Covers offered along with Bankers Blanket Bond:
Bankers Blanket Bond is usually sold as a packaged policy containing various covers as separate sections. To name few, these include:
- Electronic & Computer Crime Takaful
- Safe Deposit Box/ Locker Contents Takaful.
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