Minnesota Federal Bonding Service
Fidelity Bonding is no-cost employee dishonesty insurance that protects employers against employee theft of money or property.
The Minnesota Federal Bonding Service provides individual Fidelity Bonds to employers for new or current employees who may be denied coverage by commercial bond carriers. Some reasons for denial include workers who:
- Have a record of arrest, conviction or imprisonment
- Are economically disadvantaged youth or young adults
- Have a history of alcohol or drug abuse
- Have poor credit history
- Are welfare recipients
- Have a dishonorable military discharge
- Lack employment history
- Are unable to secure employment without being bonded
Eligibility
Fidelity Bonding may be provided for anyone who has a job offer with a set date to start work and is an at-risk new or current employee whose background tends to cast doubt upon the individual's a bility to be bonded by a commercial carriers.
The job must be full- or part-time work for which wages are paid with Federal taxes automatically deducted from the paycheck. Self-employment is not covered by the Minnesota Federal Bonding Service.
Application
There are no forms for the employer or employee to fill out or sign.The Fidelity Bond for current employees is effective when the Minnesota Federal Bonding coordinator certifies the bond.
The Fidelity Bond is issued as a policy of Travelers Property Casualty. The Minnesota Department of Employment and Economic Development is an authorized agency for the issuance of the bonds.
Employers, not workers, contact the Minnesota Federal Bonding Coordinator to apply for a Fidelity Bond.
Coverage
The Fidelity Bond has a "no deductible" amount. The amount of insurance is usually issued at $5,000. Travelers Property Casualty send the fidelity bond directly to the employer.
The duration of the Fidelity Bond is six months. If the employer makes no claim against the bond during that period, Travelers Property Casualty will make a standard commercial policy available for the employer to purchase.
Is the Program Successful?
Nationally, more than 40,000 bonds have been issued. only about 1 percent of those bonds have had claims filed against them.
To Obtain a Bond in Minnesota, contact:
Minnesota Federal Bonding Coordinator
Phone: 651.259.7500 (Twin Cities area)
Toll Free: 800.345.2537
TTY: 651-296-3900