Fidelity Guarantee Insurance


  • The policy covers the Employer in respect of any direct financial loss which he may suffer as a result of employees dishonesty.


The Company agrees to indemnify the insured against a direct pecuniary loss sustained by reason of any act of fraud/dishonesty committed

  1. On or after the date of commencement of this policy.
  2. During uninterrupted service with the Insured and discovered during the continuance of this policy or within twelve calendar months of the expiration thereof.
  3. In the case of death, dismissal or retirement of the Employee with twelve calendar months of such death, dismissal or retirement whichever of these events shall first happen.

This insurance covers any loss caused by Fraud or Dishonesty including forgery, embezzlement, larceny, Misappropriation & Default.

Parties involved in a FG Policy

  • Commercial fidelity guarantee involves 3 parties.

(a) The Insurer

(b) The insured, who is usually an employer

(c)The employee or other person whose honesty is guaranteed.

Types of Policies

  • Individual policy: Under this policy only one individual is guaranteed per policy.
  • Collective policy: This option covers the entire staff or number of selected people. One policy is issued showing amount of guarantee against the name of each individual covered.
  • Floating policy or floater: This cover is an extension of the collective policy, where the sum insured for the whole group is mentioned and not for an individual. The names of the group member with their designations are mentioned in the schedule of the policy. Each claim reduces the sum insured and has to be reinstated by paying extra premium.
  • Position Policy: The Policy schedule contains ‘positions’ rather than the names of individuals unlike in collective policy with the sum insured specified for each position. The liability for each position is limited to the amount of sum insured against each position irrespective of the number of people working in that position.

Geographical Area

  • India Only

What is not covered

  • The policy does not cover any loss if:
  • Arising out of suppression of fact affecting the risk at the time of affecting the policy.
  • There is any change in the circumstances or conditions of the said employment without the consent of the company.
  • More than one claim in respect of any one employee.
  • Arising outside India.
  • Due to non-observance or relaxations of system of checks and precautions.
  • By an act committed subsequent to an earlier act of dishonesty/fraud and which had come to the notice of the insured / insured’s representative / supervisor.

*For full details of covers, please refer to the policy terms and conditions of each Insurer.