Principles of Risk Management and Insurance, 13th Edition

Financial Institution Bonds

Commercial banks, savings and loan institutions, credit unions, stock brokerage firms, and other financial institutions are faced with crime loss exposures that can result in enormous financial losses. These exposures include bank holdups, employee dishonesty, forgery and alteration of checks, acceptance of counterfeit money, theft of securities, armored-car exposures, and numerous additional crime exposures. Because of the size and complexity of their crime exposures, financial institutions use some type of financial institution bond to deal with these exposures. In its application to financial institutions, the word bond is synonymous with insurance policy and should not be confused with surety bonds discussed later ...