What are some common exclusions in crime insurance?

Common exclusions in crime insurance policies often include acts committed by the insured or their employees if those acts were known to the insurer before the policy took effect. This exclusion is in place to prevent coverage for known issues or risks that the insured has not disclosed. Insurers rely on the information provided to them at the time of policy issuance; therefore, if they are aware of misconduct or potential claims involving the insured or their employees, those risks are excluded from coverage.

The concept of excluding acts of the insured or their employees emphasizes the principle of utmost good faith in insurance contracts. Insurers should not be liable for crimes that were already known and, therefore, should have been mitigated by the insured.

In the context of crime insurance, these exclusions help ensure that the policy provides coverage for unexpected and unforeseen crimes rather than for risks that were already apparent or known to the insured party. This protects the insurer from moral hazard where the insured might be tempted to take risks knowing that they are covered for pre-existing acts.