Smith is Manager of ABC Department Store. Jones, ABC’s Security Direct

Smith is Manager of ABC Department Store. Jones, ABC’s Security Director, visited Smith to ask some questions. During questioning, Smith admitted that he stole $10,000 in merchandise. He was disciplined, but not fired.

The loss was not reported to the insurer that wrote ABC’s crime insurance. Six weeks later, Smith was observed on a surveillance camera stealing over $50,000 in jewelry from ABC. ABC immediately reported the loss to its crime insurer. Which ISO crime coverage condition may prevent ABC from collecting for this loss?
A) termination as to any employee
B) discovery form
C) loss sustained form
D) loss sustained under prior insurance

ANSWER

Answer: A