Is Cash Theft Covered Under Construction Site Liability Insurance?

Is Cash Theft Covered Under Construction Site Liability Insurance?

In terms of constructing buildings, there are several forms of monetary losses that can be sustained, like cash theft, vandalism, disputes, and even a robbery. The characteristic features of construction projects cause business owners, as well as contractors, to purchase varying types of insurance policies to protect their assets or minimize monetary losses. However, one question perplexes many construction business owners – does construction site liability insurance cover cash theft? Most of them presume that their general liability coverage will pay for money that was taken away unjustly, but this is commonly not true. It’s crucial to comprehend the shortcomings of liability insurance and find other possible ways to receive coverage.

A Primer on Construction Site Liability Insurance

Construction site liability insurance is designed for the construction industry and falls under general liability insurance. It protects construction businesses from incurring losses from injuries to third parties, damages to other’s property, and legal actions taken against the business. It is essential for contractors and construction companies since it helps mitigate expenses linked to accidents, lawsuits, and damages during the construction works.

The Most Common Types Of Theft and Crime Mitigation At A Construction Site

Thefts is a huge problem for most construction businesses as the construction sites themselves tend to have valuable equipment, material and even cash. Other crime done at the sites includes employee theft or dishonesty of any type, each of them has its own distinctions almost equal to cash. Anything that has value, including construction machinery and tools that are expensive and often difficult to replace, are sometimes stolen. Material theft is another significant issue, because items like copper wire, lumber, and cement can be sold for great prices on the black market. Employees and even subcontractors sometimes would steal materials or equipment for their own use.

Does Construction Site Liability Insurance Include Coverage for Cash Theft?

In a nutshell, the answer is no. Construction site liability insurance isn’t meant to cover losses including cash theft. This insurance type focuses on bodily injury claims and property damage by third parties. Liability insurance covers businesses that get sued due to injuries from people who visit the construction site, or property damage caused by construction work, but does not cover losses resulting from theft.

The primary reason there is no coverage for cash theft under liability insurance is that it deals with legal liability and not direct property loss. Cash is viewed as a high-risk asset because it can easily get stolen and is very hard to trace back.

Polices Which Protect From Cash Theft For Business Insurance

Since cash theft is not covered by general liability insurance, construction companies need to think about keeping different types of insurance to cover their potential losses. One of the most relevant policies for this situation is crime insurance that protects businesses against losses resulting from thefts, robberies, and frauds. For example, a crime insurance policy will cover such things like the stolen cash in the business, dishonesty of employees, forgery, and even cybercrimes. This insurance is most suited for businesses that deal with cash and desire prtection from both internal and external theft.

Builder’s risk is an example of policies peculiar to the construction industry. This, however, like all other covers does not extend to theft of cash and focuses on the protection of construction materials, tools, and equipment within the site. Although this policy covers many useful assets on site, it does not protect against the financial losses obtained from cash theft. Because of this, it is not advisable to depend solely on builder’s risk insurance policy.

Dishonesty coverage is a specialized policy that may be useful to construction companies, especially if they fear internal theft. This insurance policy pays for losses incurred as a result of employees stealing money, materials, or company property. It tends to help construction companies that keep cash in hand, or have employees who work with cash on a daily basis.

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How Can You Secure Your Construction Site From Theft

While making sure you have the right policy is important, the ideal way to secure a construction site from theft is prevention. Taking adequate measures can help prevent cash theft, and other crimes. Making security measures more rigorous can be done by placing CCTV cameras and alarm systems on the premises. Surveillance cameras generally discourage thieves from trying to break in, and alarm systems enable law enforcement agencies to respond rapidly after being notified.

Construction firms need to adopt stringent rules related to cash security in order to eliminate the chances of theft. Robbery is less likely to occur when cashless methods like electronic payments are preferred over cash. Cash that needs to be processed on the site should be stored in a safe that is locked and restricts who it can be accessed by. Only trustworthy employees should be assigned cash handling responsibilities, and it is necessary to perform regular audits on the cash to confirm the actual amounts in the cash register.

What You Should Do Following a Cash Theft at a Construction Site

When a construction site is subjected to cash theft, prompt and rational action should be taken in order to mitigate the damage and enhance security particulars for the future. As soon as possible, call the police to report the crime. Having a filed police report allows the crime to be documented, increasing the chances of recovering the stolen funds. The owner of the business will also need to notify their insurance company to see if any policies offered, such as crime or business property insurance, can mitigate the damages suffered.

Liability insurance on construction sites offers necessary coverage for third-party injuries and property damage; however, it unfortunately excludes cash theft and theft. Because cash losses often exceed what most businesses can afford to write-off, construction business owners should adopt crime insurance policies alongside traditional business property or employee dishonesty coverage. Furthermore, surveillance cameras, access restrictions, and cashless payment systems can mitigate the cash loss problem.