What is an individual bond in employee theft coverage?

An individual bond in employee theft coverage is specifically designed to provide protection for a named individual within an organization. This type of bond identifies a particular employee, offering financial security against theft or dishonest acts committed by that employee. The bond ensures that if the named employee engages in any fraudulent behavior that results in a financial loss to the employer, the insurer will cover the loss up to the limits of the bond.

This focus on a specific individual is crucial for situations where an employer wishes to mitigate risks associated with a particular employee who may have access to significant company assets or confidential information. The definition excludes broader coverage concepts, such as those that apply to all employees or to the actions of any employee collectively, emphasizing the tailored aspect of risk management that individual bonds provide.