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

Commercial Crime Declarations - Form CR DS 00

1. What the form is

The Commercial Crime Declarations (Form CR DS 00) is a crucial document in a commercial crime insurance policy. It functions as the personalized "cover page" of the policy, outlining the specific choices made by the insured and accepted by the insurer. This form itemizes the insuring agreements selected by the named insured, the corresponding limits of insurance for each selected coverage, and the applicable deductible amounts for each. It also lists any endorsements that modify the policy and provides other essential policy-specific information, such as the policy number, policy period, and the named insured's details. Essentially, it tailors the broader Commercial Crime Coverage Form (like CR 00 20 or CR 00 21) to the individual needs and risk profile of the insured business. Coverage under a specific insuring agreement only applies if a limit of insurance is shown next to it on the declarations page.

2. Classes of business it applies to

The CR DS 00 is applicable to a wide array of commercial entities seeking protection against crime-related losses. It is not specific to a single industry but is used by any business that opts for a Commercial Crime Coverage Form to protect its assets. Examples include:

• Retail businesses: Concerned about employee theft of cash or merchandise, forgery, or robbery.
• Service industries: Such as legal or accounting firms, at risk for employee dishonesty, computer fraud, or forgery.
• Manufacturing companies: Facing risks of employee theft of raw materials or finished goods, or computer fraud targeting financial systems.
• Non-profit organizations: Which handle donations and are susceptible to employee theft or fraudulent disbursements.
• Hospitality businesses (e.g., hotels): While they might have specialized endorsements, the base crime coverages declared on CR DS 00 are relevant for employee theft or theft of money and securities.
• Any business with employees and financial transactions: Given the common crime exposures like employee theft, forgery, computer fraud, and theft of money or securities.

Governmental entities typically use different, specifically designated government crime declarations forms (e.g., CR DS 03, CR DS 04).

3. Special considerations

• Selection of Insuring Agreements: The insured must carefully select which insuring agreements are needed. If an insuring agreement is not listed with a corresponding limit and deductible on the declarations, there is no coverage for that type of loss. For example, if "Employee Theft" is not selected and a limit provided, losses from employee dishonesty will not be covered.
• "Discovery" vs. "Loss Sustained" Basis: The CR DS 00 will be attached to either a "Discovery" form (e.g., CR 00 20) or a "Loss Sustained" form (e.g., CR 00 21). The declarations page itself doesn't dictate this, but it's crucial for the insured to understand which basis applies, as it affects when a loss needs to be discovered and when it needed to have occurred to be covered. A "Discovery" form covers losses discovered during the policy period, regardless of when they occurred (subject to policy terms), while a "Loss Sustained" form covers losses sustained during the policy period and discovered during that period or a specified time after.
• ERISA Compliance: If the insured has an employee benefit plan subject to ERISA, specific coverage for that plan (often under the Employee Theft insuring agreement) must be indicated on the declarations to meet bonding requirements. Recent ISO changes may require electing ERISA plan official dishonesty coverage in addition to employee theft.
• Cancellation of Prior Insurance: The declarations page may include a section that cancels any prior crime policies issued by the same insurer to the named insured upon acceptance of the new policy.
• Accuracy of Information: The information provided by the insured, which forms the basis for the declarations, must be accurate. Material misrepresentations can potentially void coverage.

4. Key information for agents and underwriters

• Risk Assessment: The selection of insuring agreements and the requested limits provide insight into the insured's perceived risks. Underwriters will scrutinize these in conjunction with the nature of the business, its internal controls, and loss history. For example, a business handling large amounts of cash requesting high limits for "Inside the Premises – Theft of Money and Securities" would warrant a review of their cash handling procedures and security measures.
• Pricing: The limits of insurance and deductibles chosen for each insuring agreement are primary factors in premium calculation. Higher limits and lower deductibles will result in higher premiums.
• Coverage Gaps: Agents should carefully review the client's operations to ensure all significant crime exposures are addressed by the selected insuring agreements. Failing to select an appropriate coverage (e.g., Computer Fraud for a business heavily reliant on electronic transactions) can lead to significant uninsured losses.
• Underwriting Guidelines: Underwriters will assess the adequacy of the insured's internal controls relative to the coverages and limits requested. For instance, for Employee Theft coverage, underwriters will be interested in hiring practices, segregation of duties, and audit procedures. For Computer Fraud, they will look at cybersecurity measures.
• Endorsements: The declarations page will list all applicable endorsements. Agents and underwriters must understand how these endorsements alter the standard coverage provided by the Commercial Crime Coverage Form. There are numerous endorsements available to tailor coverage, such as for clients' property or funds transfer fraud.
• Limits and Deductibles: Ensure the limits are adequate to cover potential maximum losses for each selected insuring agreement. The deductible should be at a level the insured can comfortably absorb. The policy pays the amount of loss in excess of the deductible, up to the limit of insurance. If a loss is covered under more than one insuring agreement, the policy will typically pay no more than the largest single applicable limit.
• Named Insured: Clarity on who constitutes the "Named Insured" is vital, especially regarding subsidiaries or employee benefit plans, which should be properly listed if coverage is intended. The first Named Insured generally acts for all other insureds for policy purposes.