Locksmith’s Employee Theft Bond

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Locksmith’s Employee Theft Bond

Surety Bond Professionals is a family owned and operated bonding agency with over 30 years of experience. With access to a broad range of surety markets, our expert agents are ready to assist with locksmith’s employee theft bond needs.

What Are They?

A locksmith’s employee theft bond belongs to the class of surety bonds known as employee dishonesty bonds. They function much like insurance in that they provide protection for business owners against financial losses stemming from theft or fraud committed by an employee. Employee dishonesty is always a possibility, no matter how careful a business owner is in hiring staff. But purchasing an employee theft bond gives a locksmith a way to recover stolen or fraudulently misappropriated funds.

Be aware that an employee theft bond does not protect a locksmith’s clients against the financial consequences of crimes committed by an employee while working on client premises. To provide that kind of protection for clients, a locksmith would need to purchase a business services bond.

Who Needs Them?

There is no requirement for a locksmith to purchase an employee theft bond. All employee dishonesty bonds are purchased voluntarily. But any locksmith who is concerned about the possibility of financial loss from employee theft should consider purchasing a locksmith’s employee theft bond.

Speak with a Surety Bond Professionals agent today to discuss your bonding needs.

How Do They Work?

Purchasing a locksmith’s employee theft bond creates a legally binding contract between the locksmith (known as the bond’s “principal”) and the party serving as the bond’s guarantor (referred to as the “surety”). The surety determines whether a claim for damages filed by the principal is legitimate and must be paid. Be aware, though, that a claim is not likely to be paid until the employee committing the theft has been convicted of a criminal offense.

What Do They Cost?

Employee theft bonds are sold on a premium basis, the annual premium being determined by the surety through an underwriting process. Underwriting factors include the number of employees and whether the bond covers only certain named employees (such as those who are authorized to write checks or have access to cash) or provides blanket coverage for all employees. The underwriting aim is to assess the risk of claims that the surety will have to pay.

The lower the perceived risk, the lower the bond’s premium rate. Conversely, higher risk results in a higher premium rate. Most bond applicants will be assigned a premium rate that’s in the standard market rate range of one to three percent.

The annual premium that a given principal will pay is calculated by multiplying the bond’s coverage amount by the premium rate. Because locksmith’s employee theft bonds are purchased voluntarily, the coverage amount is left entirely up to the principal.