Credit Union Bonds in Illinois

Learn more about our credit union bond coverages and get a quote from one of our knowledgeable independent agents. Providing coverage to credit unions across Illinois, Indiana, and other states.

What are credit union bonds? 

Credit unions process large amounts of checks, securities and cash, and each dollar that passes through a branch represents potential risk. If an Illinois credit union sustains loss due to employee dishonesty, forgery, theft or another covered loss, credit union bonds may provide financial protection.

Credit union bonds help credit unions shield against losses caused by both internal and external bad actors. Policies may provide important protection when money goes missing.

Which credit unions in Illinois need bonds? 

All federally insured credit unions are generally required to have bonds. Credit unions in Illinois normally need a bond regardless of their size, membership count or security measures in place. No system can prevent all potential cases of dishonesty, fraud and theft.

What risks does a credit union bond cover?

A credit union bond can cover a variety of risks, potentially including dishonest acts, counterfeiting, theft and other potential malactions. Depending on its specific terms, one of these bonds might cover:

• Business Credit/Debit Card: Generally losses due to a lost, stolen, altered or outright counterfeit credit or debit card that’s issued by the credit union.
• Employee or Director Dishonesty: Generally losses due to dishonest acts of employees or directors, whether acting alone or in collusion with others. It’s normally important to make sure directors and employees are both covered, and not just employees.
• Counterfeit Currency: Generally losses due to accepting counterfeit currency, including both U.S. and foreign currency.
• Counterfeit Check or Securities: Generally losses due to counterfeit share drafts, counterfeit checks or counterfeit securities. May also cover counterfeit documents, such as counterfeit deeds, titles, or certificates of origin.
• Theft and Burglary: Generally losses due to theft, burglary or robbery committed by outsiders, possibly including vendors. Usually limits coverage to a branch’s premises.
• Off-Premises ATM: Generally losses due to burglary and/or damage occurring at off-premises ATMs.
• Fraudulent Funds Transfer: Generally losses due to fraudulent instructions received via email, fax or phone. May also cover losses arising from communications that purportedly came from the credit union.
• Extortion: Generally applies in cases of kidnapping, ransom or other extortion. May cover reasonable mitigation and investigation costs, the held party’s salary, and costs incurred if defending the credit union against negligence claims.

There are still more coverages that bonds can offer, and each defines the protections provided. A specialized agent who’s familiar with credit union bond needs can explain each of a bond’s protections in more detail.

Does a credit union bond cover digital risks?

Most of these bonds include multiple protections for online and digital risks, but exact protections can vary. Credit unions should work with a knowledge insurance agent, to make sure they understand what types of digital risks a specific bond covers.

Do credit unions have to renew their bonds annually? 

Many bonds offered to credit unions have a fixed term of one year, but some offer multiple years of coverage. Getting a multi-year bond can mitigate future cost increases due to premium increases, and often qualifies for a slight discount on the premiums paid.

How much do credit unions pay for their bonds?

The cost of a credit union bond is based on many factors, not the least of which are a credit union’s size, number of locations and ATMs, branch locations, assets held, and security measures.

An independent insurance agent who’s familiar with credit unions’ coverage needs should be able to compare bond protections and costs. Independent agents are able to look at offerings from different insurers, and thus can help credit unions find the best protections at the most affordable price.

How can credit unions in Illinois get credit union bonds? 

If you need help getting bonds for a credit union in Illinois, reach out to the independent insurance agents at L.A. Blanchette Insurance. We’re familiar with the many insurance needs that credit unions have, including credit union bonds, and will make sure you find a bond that’ll protect your credit union well.