FINA 4358 HOMEWORK 9

FINA 4358 HOMEWORK 9 Commercial Property Insurance Homework 9 The Production Dynamics, Inc. “retail outlet” is insured under the ISO Commercial Crime Coverage Form that includes the following insuring agreements: • Employee Theft • Inside the Premises – Theft of Money and Securities • Inside the Premises – Robbery or Safe Burglary of Other Property • Outside the Premises Indicate which, if any, of those insuring agreements would cover each of the following losses. If a loss is not covered by one of the insuring agreements, explain why, and identify another insuring agreement, if any, that would have covered the loss. 1. An employee of PDI voided the record of an actual sale and took the cash that had been deposited in the cash register for that sale. Yes. Because ISO Commercial Crime Coverage covers employee theft. 2. After receiving a lower raise than she expected, a PDI employee intentionally damaged store merchandise. Yes. Because ISO Commercial Crime Coverage only covers damages inside the premises resulted from theft of money and securities, robbery or safe burglary of other property. 3. During the busy season, PDI hired a new sales clerk from a temporary staffing agency. The temporary employee stole several small but valuable articles of merchandise. One week following the end of the temporary employee’s service, PDI discovered the loss by reviewing store surveillance tapes. Yes. Because ISO Commercial Crime Coverage covers the loss or damage inside the premises resulted from employee theft. 4. A PDI employee was rumored to be secretly selling GPS devices from PDI’s inventory and pocketing the proceeds. The employee admitted doing no wrongdoing, but a physical inventory revealed that five such GPS devices were unaccounted for, resulting in a $1,250 inventory shortage. Yes. Because ISO Commercial Crime Coverage covers the loss or damage inside the premises resulted from employee theft. 5. While a PDI employee closed up the store in Denver at the end of the evening, his friend was waiting in the warehouse to give him a ride home. The friend stole a book of checks from the office when the employee was busy in another part of doc (13) the store. The next day, without any knowledge or collusion of the employee, his friend purchased $925 worth of merchandise at a nearby store by signing PDI’s name to a stolen check. No. Because ISO Commercial Crime Coverage only covers the loss or damage inside the premises resulted from employee theft. 6. A ring of thieves staged a medical emergency in the store. During the confusion and without being observed by anyone, an accomplice stole $600 worth of merchandise. No. Because ISO Commercial Crime Coverage only covers the loss or damage inside the premises resulted from employee theft.