Smith is Manager of ABC Department Store.Jones,ABC's Security Director,visited Smith to ask some questions.During questioning,Smith admitted that he stole $10,000 in merchandise.He was disciplined,but not fired.The loss was not reported to the insurer that wrote ABC's crime insurance.Six weeks later,Smith was observed on a surveillance camera stealing over $50,000 in jewelry from ABC.ABC immediately reported the loss to its crime insurer.Which ISO crime coverage condition may prevent ABC from collecting for this loss?

Question

Quizplus · Accepted Answer

ISO crime coverage condition "termination as to any employee" allows the insurer to deny coverage for any loss involving an employee who has been terminated due to dishonesty or other criminal acts. In this case, Smith admitted to stealing $10,000 in merchandise before he was disciplined but not fired, which may make it difficult for ABC to collect for the subsequent loss of $50,000 in jewelry.

Smith Is Manager of ABC Department Store