Customer Contracts: Does Crime Insurance Cover Employee Theft from Clients?
By Atlas Risk Partners ·
Not automatically. Before accepting a customer contract's employee-theft requirement, verify that the actual crime coverage reaches theft of the client's money or property by your employees—not just theft from your own business. Check the client-property wording, selected coverage, definitions and applicable limits. Separately examine whether coverage addresses any liability or defense costs the contract expects.
Find the provision that reaches the client's assets
When a customer requires insurance against theft by your staff, start by separating whose assets are at risk. Do not mark the requirement as satisfied merely because a crime proposal contains an employee-theft limit.
Chubb's U.S. commercial crime product lists employee theft and client theft as separate insuring clauses, and describes blanket coverage for employee theft of clients' funds and other property as available.
The practical takeaway from this product example is to locate the selected client-property provision in the proposed policy. A coverage category appearing on an insurer's website does not establish that it is included in your purchase.
Match the wording to the work
Use the customer project as a review scenario. The following questions are an original preparation tool for applying the client-property distinction, not a summary of every carrier's terms.
- Customer: Does the client definition include the contracting entity and any affiliate whose assets staff will access? Is coverage blanket or restricted to listed clients?
- Assets: Identify customer money, securities or tangible property. If the contract also references data or intellectual property, ask whether those fit the insured property definitions.
- Staff: Match the roles with access to the policy's employee definition; do not assume it includes every person working on the project.
- Location: Ask whether the provision reaches the actual work arrangement, including onsite visits and remote system access, or contains a premises restriction.
- Selection: Confirm the client-property agreement or endorsement is included in the coverage being purchased, rather than merely offered as an available option.
Separate stolen assets from a customer's liability demand
The New York Department of Financial Services' small-business guidance discusses property losses and legal liability as different exposures. Apply that distinction here: reimbursement for stolen assets is a different coverage question from defending a customer's claim or paying additional contractual damages.
For the contract review, itemize the stolen assets, any demand for the customer's lost income or other damages, and your defense costs. Ask where each appears in the proposed wording, including relevant exclusions. Do not treat an identified client-theft clause as confirmation that all these categories are covered.
Ask which loss costs the proposed client-theft coverage addresses. Chubb lists claim and computer investigation expense provisions, but that product description does not establish payment for every investigation or customer demand under a particular policy.
- Limits: What limit applies to client theft? Is there a sublimit, and is any limit shared with other crime coverage?
- Deductible: What deductible or retention applies to the relevant loss?
- Expenses: Under what conditions are investigation expenses covered? Are defense costs or additional damages included at all?
Sources: The Chubb Primary Commercial Crime Insurance · Information for Small Businesses — New York Department of Financial Services
Test one concrete loss before promising coverage
Hypothetical example: A software company is signing an implementation contract requiring protection against employee theft of customer property. Its employees will work at the client's office. An employee steals client-owned laptops. The quote shows an employee-theft limit, but the finance team has not identified wording extending that coverage to client property.
The unresolved task is to locate the applicable client-theft agreement, match the client and employee definitions, and check the relevant limit and deductible. Then test separately any demand for the customer's downtime or legal expenses.
This example illustrates a review method; it does not predict whether a real claim would be paid. Matching the stolen property to a coverage provision does not resolve every other element of the customer's requirement.
Turn unresolved points into a focused quote request
For an internal comparison, record the customer requirement, the proposed policy provision addressing it, and any remaining question. Use three labels: supported by identified wording, needs clarification, or not included in the proposal. This keeps a marketing summary from becoming the basis for a coverage promise.
A focused crime-insurance quote request can use a non-confidential description of your services, the categories of client assets staff can access, and the insurance protection being sought. Specify that the review concerns employee theft of client assets. Ask for the relevant proposed wording and selected coverage schedule rather than compare headings alone.
A contract's liability promises should be assessed separately from the insurance match. Availability varies by carrier, state and risk. The insurer example does not establish Atlas Risk Partners' access to that product. This is general education, not confirmation of contract compliance; it does not bind or establish coverage. Policy wording controls.
Sources: The Chubb Primary Commercial Crime Insurance · Information for Small Businesses — New York Department of Financial Services
Your preparation checklist
- Summarize the customer insurance requirement internally without circulating confidential customer information.
- Identify whose money, securities or tangible property employees could access.
- Record whether the work occurs onsite, remotely or both.
- Locate the proposed client-property agreement or endorsement and confirm it is selected.
- Check client and employee definitions, any client schedule and any premises restriction.
- Identify applicable limits, sublimits, shared limits, deductibles or retentions.
- Ask which investigation expenses, defense costs and additional damages are included or excluded.
- Document unanswered questions before communicating that the customer requirement is met.
Sources and editorial approach
Atlas publishes practical insurance education using public regulatory and insurer materials. Insurer examples describe their own products and do not establish Atlas market access. Your policy and endorsements determine actual coverage. This article is general information; it does not bind coverage or replace advice about your particular business.
- The Chubb Primary Commercial Crime Insurance
U.S. product example distinguishing employee theft and client theft, describing blanket client-property coverage as available, and listing investigation expense provisions. Not evidence of Atlas carrier access.
- Information for Small Businesses — New York Department of Financial Services
New York consumer guidance describing property-loss and legal-liability exposures separately. Used for that distinction, not as a nationwide coverage rule or legal conclusion.
Have a correction or a question? Contact Atlas.
