OVERVIEW

ACORD forms are intended for use with products from standard industry rating and forms organizations, like the Insurance Services Office (ISO), which provides coverage forms, policies, manuals, rules, and rating plans. One example is the Commercial Crime Coverage.

Typically, ACORD forms are quite general. However, Commercial Crime Coverage might be issued alongside a specialized or company-specific program. In such cases, tailored forms for that particular account may be required, either instead of or in addition to the standard ACORD forms. This is because they often demand more detailed information, thorough hazard analysis, or specific details not covered by the general ACORD forms.

Any changes from the 06 22 edition have been incorporated into this article and highlighted in bold.

RELEVANT ACORD FORMS

NOTE: This section includes only countrywide forms; state-specific ACORD forms are not included.

Form 125–Commercial Insurance Application–Applicant Information Section
Form 141–Crime Section 2000

SPECIFIC ACORD FORM CONSIDERATIONS

Form 125–Commercial Insurance Application

All information requested in this form is pertinent and of significant importance. The relevant boxes should be checked to ensure the insurance company’s underwriter comprehends the lines of insurance being submitted for consideration.

The first named insured and all other named insureds must be listed.

Applicant information is crucial for addressing coverage concerns and supplying contact details for inspections, financial matters, and premium audit functions.

Loss information for larger accounts should probably be submitted as hard copies of the current year-to-date loss runs for the past five years, along with the current year-to-date data. For experience rating on larger accounts, accurate, up-to-date loss information for the most recent three full and complete years is necessary.

Form 141—Crime Section 2000

Coverage Section:	Insuring Agreement #
Commercial Fidelity/Government Fidelity	1
Forgery or Alteration	2
Inside the Premises–Theft of Money and Securities	3
Inside the Premises–Robbery or Safe Burglary of Other Property	4
Outside the Premises	5
Computer and Funds Transfer Fraud	6
Fraudulent Impersonation	7
Money Orders and Counterfeit Money	8

Coverage Endorsement Section

Any optional or additional coverage endorsements requested should be listed in this section.

ERISA Employee Theft –Additional Information Section

This is where covered employee benefit plans are listed. The plan name, plan administrator's address, number of trustees, number of employees, number of others who handle assets, and number of plan participants must be entered in the provided spaces.

If a licensed securities firm is responsible for investing the plan's funds, mark the box Y (Yes); if not, mark it N (No).

This information is very important when the crime coverage is used to satisfy the named insured’s ERISA bond requirements.

General Information Section

This section contains crucial information for underwriting and rating. All questions must be answered, and any "yes" responses should be explained in the Remarks section.

Classification of Employees/Locations

This section is important for accurately underwriting and rating employee theft. It is imperative the following information be entered:

Employee count by job classification

Number of officers
Total number of other employees
Number of retail locations for manufacturers, processors, wholesalers, or distributors
If not a manufacturer, processor, wholesaler, or distributor, the number of locations excluding the home or head office.

Hiring Practices

None of these questions needs an explanation. However, a “no” response to any of these eight questions can have a significant impact. From an underwriting perspective, a yes answer is expected.

Controls and Audit Procedures Section

Questions in this section apply to employee theft coverage. It is crucial to provide full information for underwriting. Generally, no explanations are needed unless specified. However, if any questions in the Banking or Other sections are answered 'no,' comments or explanations should be added in the Remarks section. Additionally, such 'no' responses should be discussed with the named insured, as they can reveal potential exposure to employee dishonesty claims that might be addressed through management adjustments.

Money and Securities Section

This section serves as a worksheet to identify potential loss exposure by listing the actual maximum exposures in various categories. It also helps evaluate whether the selected insurance limits adequately cover the true loss potential. It is important to understand that the maximum exposure amounts are entered, not the requested limits.

Purchasing/Receiving Controls

This section outlines the inventory controls in place to prevent employee theft. An explanation is not necessary, but any “no” answers should be reviewed as potential loss scenarios.

Computer Fraud Controls

These questions highlight potential failures by the named insured in protecting itself from computer fraud. An explanation is not required, but any “no” responses should be examined as possible loss situations.

Property Section

The type of property, merchandise, or stock handled by the named insured should be described. Rating classifications and loss costs generally reflect the exposure to loss, but an insured may not be involved with all items included in each classification.

The named insured may also possess merchandise that is more vulnerable or prone to theft and burglary. The maximum coverage amount should be the replacement value of the property, merchandise, or stock.

Miscellaneous Information Section

These questions provide the underwriter with details about hours of operation, the number of employees on duty during business hours, deposit procedures and their frequency, annual gross sales, and the type of door locks. There is also space for any other relevant information.

Safe/Vault Section

These questions are very specific and highly technical. Details about safes and vaults are typically found inside the door frame, on the interior of the door, or elsewhere inside the safe and smaller or older vaults. Information regarding newer or more advanced vaults is usually available from the manufacturer.

Messenger Protection Section

This section provides information on the number of guards escorting a messenger and whether a private conveyance and a safety satchel are used. All these details directly influence rating and premium development.

Premises/Safe Protection Section

This section's questions help the underwriter assess the level of premises protection and intruder-detection measures. It requires details about the alarm type and description. For central station protection, the certificate number and expiration date must be provided.

The manufacturer of the alarm should also be disclosed, along with information on system maintenance, operation, and notification procedures. Additionally, questions cover fences, floodlights, and space for other security features such as security cameras. All accessible openings should be investigated to determine if they are adequately protected.

Employee Section

This section is completed only when an employee is to be scheduled with a specific insurance limit and deductible.

Remarks Section

This section is designated for the explanation of any “yes” responses from previous sections or for any additional comments needed.