An opportunist thief has stolen an employee’s bag from your workplace; it contained their railcard, mobile phone, house keys and £100 in cash. You are as upset about it as they are, but can they claim on your insurance?

Sadly, opportunist theft occurs all too often. One of our members recently suffered such an incident. The back door to the premises was left open and someone snuck in and stole an employee’s bag. It contained several personal belongings, which will prove rather costly to replace. But who is responsible for covering this loss?

Responsibility for employees’ personal effects at their employer’s premises has always been a difficult issue, particularly where expensive items are involved. Although you are under a legal duty to provide a safe working environment for your employees, you are under no obligation to replace, or bear the cost of replacing, any of their possessions stolen, or removed, from your workplace, or damaged while on-site.

The insurance position

A typical commercial insurance policy, which covers the contents "owned by the business or for which it is, or may be, responsible", will include an element of cover in respect of employees’ belongings. However, it will contain a number of limitations.

Cover usually only operates if the items are "not otherwise insured" for example if they are covered elsewhere say, on an employee’s home insurance policy. In addition, a relatively modest limit will apply for any one loss; this is usually around £500 to £1,000 and any claim made will probably be subject to an excess,.

Yet this type of cover will generally only pay out for a theft that involves a "forcible entry and/or violent means". So if you have a break-in you are probably covered. But leave a back door open, as in the case of our member, and you won’t be. There may also be a specific exclusion regarding theft by any of your own employees.

Employees bringing their belongings into work should be made aware of the need to take all necessary precautions to protect their personal property while on the business premises. Disclaimers should be prominently displayed around your workplace stating you "accept no responsibility for any loss or damage to personal effects brought on to your premises".

Staff should also be reminded of the need to take out their own insurance for items they take away from their home.