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Individual Policy
Floater Policy
Blanket Policy
Bank Guarantees

we will introduce you fidelity guarantee insurance, and tips on improving your internal controls to manage this risk that every business will face.


What is Fidelity Guarantee Insurance?

Fidelity guarantee insurance is a guarantee by the insurance company to indemnify your loss arising from employees’ dishonesty.


Examples of losses arising from employees’ dishonesty include:

  • Theft of cash register’s monies

  • Misappropriation of the business’s cash for the employees’ personal gain

  • Theft of the business’s inventory

Types of Fidelity Guarantee Insurance

There are 4 types of fidelity guarantee insurance:

Individual Policy

The individual policy covers an individual employee for a prespecified amount. Once the dishonesty has been discovered, you should report the discovery within 24 months.

Collective Policy

The collective policy, as the name suggests, covers a group of employees. Based on each employee’s position and responsibilities, you will decide the amount of guarantee required.

Floater Policy

The floater policy is similar to the collective policy. The difference is that only one amount of guarantee is given across a group of employees instead of different guarantee amount. Usually, you need at least five employees to be covered under floater policy.


Blanket Policy

The blanket policy guarantees a group of employees, for e.g. employees who manage cash, without the names of the guaranteed person. The guaranteed amount can be in terms of each employee or on the amount of loss. Blanket policies are usually issued to more established businesses with sound internal controls.

Exclusions of Fidelity Guarantee Insurance

As with most other insurance, there are some exclusions to fidelity guarantee insurance. Some of the common exclusions are:

  • Change in the nature of your business;

  • Change in responsibilities or salaries of your employee who are covered under the insurance;

  • Losses that are not backed by evidence due to bad accounting system;

  • Third-party losses;

  • Losses resulting from negligence, extortions, and blackmails;

Understanding the exclusions of any insurance is important to you as a buyer. You would not want to do anything that might result in not being able to claim your insurance. Always consult your insurance agent or company if you are in doubt.

Who is Fidelity Guarantee Insurance for?

As long as you have employees handling cash or processing payment, fidelity guarantee insurance will be useful for you.

However, the following businesses will benefit from fidelity guarantee insurance more:


Unless you are manning your cash register all the time, if not, you will face the risk of someone else stealing money from the cash register.

Restaurants and Cafes

Similar to retailers, restaurants and cafes are more vulnerable to dishonest employees. In fact, theft is one of most common risks that a restaurant owner faces. With the high turnover in the Singapore F&B industry, it is getting more difficult to hire honest and competent employees.


Key Factors to Consider When Buying Fidelity Guarantee Insurance

Use Internal Controls to Prevent Dishonest Acts

One of the best way to manage risks of dishonest employees is to set up proper internal controls within your business.

The internal controls should aim to prevent dishonest acts. If the dishonest acts happen, you also should be able to detect them.

Cash Management Process

The following tips are useful in the cash management process:

  • Ensure proper handing and taking over of the cash register. Schedule a handover in the presence of the manager, and ensure both handing over and taking over casher verify the cash amount.

  • Reconcile your records daily. Always reconcile the beginning cash, transactions for the day and ending cash.

  • Always provide your customer with a print receipt. A print receipt represents a transaction recorded in your business’s system. This transaction will be useful to verify the correct ending cash.

  • Keep big notes in a safe. Transfer big notes to a secure area regularly. The cashier most probably does not need these notes anyway.



Payment Process

Payment is one process that is most vulnerable to fraud. To reduce the possibilities of fraud, you can implement the following:

  • Separate key duties. Separate the duty among those who approve payee (or suppliers), and those who make the actual payment. For example, an employee who is in charge of making payment, cannot approve or add suppliers in the payment system. This prevents the employee from adding himself (or related entity) as the payee, then pay himself using the business’s cash.

  • Require mandatory block leave. Most fraudulent acts require the dishonest employees to maintain daily so as to keep the records clean. By making leaves compulsory, your employees will realise that they will get caught by their colleagues during their leave.

  • Require additional cheque signatories. If you use cheques in your business, you may want to designate additional signatories beyond a certain amount.

  • Require additional approval in internet payment. Similar to issuing a cheque, you may want to designate additional approver beyond a certain threshold for internet payment.

  • Maintain proper records. Make sure that you maintain records on the payee, the amount paid, initiator, approver, and the reason for all your payments. This information will be useful when you are conducting a check.

With these internal controls in place, not only you will minimize the possibility of dishonest acts, but you are also in good position to negotiate for lower fidelity guarantee insurance premiums.

Cost of Fidelity Guarantee Insurance

The cost of fidelity guarantee insurance are based on the following factors:

  • Guarantee amount

  • Number of employees insured

  • Deductibles

  • Your internal controls

Feel free to contact us for a quotation.

Please note that fidelity guarantee insurance is usually offered as part of the general business insurance package. The package also includes other insurance like public liability insurance, product liability insurance, work injury compensation insurance, etc.

Choosing the Type of Fidelity Guarantee Insurance

You should identify which process requires fidelity guarantee. The more common processes are cash register management, payment process, and stock-taking process.

Depending on the number of employees involve in these processes, and your business requirements,  you will have to select the most suitable type of fidelity guarantee insurance.

If you have trouble figuring it out, please do not hesitate to contact us.

Reputable Insurance Company and Agent

You should buy your insurance from a reputable insurance company. An experienced insurance agent like Anthola can also advise on your insurance needs based on your business requirements.


You can never prevent dishonest acts from your employees. With fidelity guarantee insurance, at least you will be able to recoup some of the losses.

Every business is different. If you are interested in buying a fidelity guarantee insurance, please give contact us. We love to speak to you!

Bank Guarantees

There are risks of failure or refusal of one of the parties to fulfill its obligations to other party during the partnership at local and international level. The bank guarantee is widely used all over the world as a reliable protection of other party from financial losses.

ISG Insurance Bank offers bank guarantee services for both domestic and international transactions. The Banks issues various bank guarantees both within its own capabilities and within the cooperation of the worldwide known 1st class banks.

The Bank’s professionals provide complete consulting support in information about bank guarantees and selection of bank guarantee type depending on the customer needs.

Description of bank guarantee

A bank guarantee is a written instrument guaranteeing by bank to a party (seller / creditor / beneficiary) on behalf of his customer (buyer / debtor / principal), to effect payment on default of obligation against submittal of written demand or other documents specified in the guarantee.

Thus, if the customer defaults on the payment to other party or refuses to pay, the Bank will cover the loss at its own account.

The International bank guarantee is a written instrument guaranteeing payment to a party abroad against the submittal of its written demand or other documents indicated in letter of guarantee.

Advantages of bank guarantee

- Customer (Buyer) is not required to make the advance payment in case of bank guarantee, thus the funds are used more effectively;
- Buyer gains reliable partner status at local and international markets, benefits from various partnership opportunities and is able to demand more relevant conditions from partners;
- Seller is protected from default of Buyer on payment and is able to perform prompt sales without asking advance payment;
- Bank guarantee requires less number of documents, no necessity for collateral and, as a result, the customer receives the letter of guarantee within shorter period of time and commission fee for services is also very low.

Main types of bank guarantees

1. Guarantee of payment. This type of guarantee is a security of payment obligations of Buyer to Seller.

2. Guarantees of advance payment return. This guarantee represents an obligation of the bank to return advance payment in the event that, after receiving an advance, the Seller does not perform its contractual obligations.

3. Contract execution guarantee. This guarantee is a security of timely delivery of goods or performance of services according to a contract.

4. Tender guarantees. This guarantee plays a role of security in those cases when the Company fails to perform its obligations to tender organization or other party that is stipulated in the order received by winning the tender.

5. Guarantee in favor of the customs authorities. This guarantee is a security of obligation of the company performing import and export operations to the Customs authorities for payment of customs taxes and duties.

6. Guarantees of warranty execution. This guarantee plays a role of security of quality for delivery to the contract terms.

7. Guarantee of credit return. This guarantee is a security for repayment of credit.

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