1. Forms
2. CR
3. CR-00-30

What the Form Is

The CR 00 30 Government Fidelity and Forgery Policy (Discovery Form) is an insurance policy developed by ISO (Insurance Services Office) for governmental entities. It provides coverage for financial losses resulting from dishonest acts by employees (referred to as fidelity) and losses due to forgery or alteration of financial instruments. A key feature of this form is that it operates on a "discovery basis." This means the policy covers losses that the insured discovers during the policy period, regardless of when the actual act causing the loss occurred, subject to the policy's terms, conditions, and any applicable retroactive date. This is distinct from a "loss sustained" form, which typically covers losses that are both sustained and discovered within the policy period or a specified extended reporting period.

Classes of Business It Applies To

This policy is specifically tailored for governmental entities. This can include a wide range of public bodies, such as:

• Municipal governments (cities, towns, villages)
• County governments
• State agencies and departments
• Public school districts
• Special purpose districts (e.g., water, sanitation, park districts)

For example, if a county treasurer's office discovers during the policy period that an employee had been embezzling funds over the past several years, this policy, if in effect at the time of discovery, would be triggered to cover the loss, subject to its limits and other provisions.

Special Considerations

Several important considerations apply to the CR 00 30:

• Discovery Trigger: The "discovery" trigger is a critical aspect. The policy defines when a loss is considered "discovered." This can be advantageous for uncovering losses from acts that were concealed for extended periods.
• Monoline Policy: This form is typically written as a monoline policy, meaning it provides crime coverage specifically, rather than being part of a package policy.
• Comparison to Loss Sustained Form: It is often compared to its counterpart, the CR 00 31 Government Employee Theft and Forgery Policy (Loss Sustained Form). The choice between a discovery and a loss sustained form depends on the insured's specific circumstances and risk management preferences.
• Policy Definitions: The definitions of "employee," "forgery," "discovery," and other key terms within the policy are crucial for understanding the scope of coverage.
• Program Revisions: The ISO Commercial Crime program, including this form, undergoes periodic revisions. For instance, the 2022 editions introduced changes such as renaming "Employee Theft" to "Fidelity" and restructuring some insuring agreements. It's important to refer to the specific edition date of the policy being used.

Key Information for Agents and Underwriters

• Explaining Coverage Triggers: Agents must clearly explain the difference between "discovery" and "loss sustained" coverage to governmental clients to ensure they select the form that best meets their needs.
• Risk Assessment: Underwriters will carefully evaluate the internal controls, oversight procedures, and segregation of duties within the governmental entity. The number of employees, their level of access to funds and valuable property, and any prior loss history are significant underwriting factors.
• Setting Limits and Deductibles: Appropriate limits of insurance and deductible levels need to be determined based on the entity's exposure and financial capacity.
• Identifying Coverage Gaps: Agents and underwriters should be aware of potential coverage gaps and whether endorsements are needed to tailor the policy. For example, coverage for virtual currency was initially excluded but could be added back via endorsement for certain insuring agreements in some editions.
• Understanding Exclusions: Like all insurance policies, the CR 00 30 contains exclusions. These must be thoroughly understood to manage expectations and identify uninsured exposures.
• Declarations Page: The CR DS 08 Government Employee Theft and Forgery Policy Declarations is used with this policy and specifies the insuring agreements, limits, and deductibles.