Certified Fraud Examiner 2025 – 400 Free Practice Questions to Pass the Exam

Question: 1 / 400

What type of insurance provides protection against fraud losses?

Liability Insurance

Property Insurance

Fidelity Bond

Fidelity bonds are specifically designed to protect businesses from losses incurred due to dishonest acts of employees or third parties, including fraud. This type of insurance directly addresses the risk of theft, embezzlement, or other fraudulent activities that could result in financial loss to the organization. Fidelity bonds provide coverage for the direct financial impact of these actions, giving businesses a safety net against internal theft and fraudulent behavior.

In contrast, liability insurance generally offers coverage against claims for damages caused to third parties, property insurance protects against loss or damage to physical assets, and health insurance covers medical expenses for individuals. None of these options specifically focus on losses resulting from fraudulent actions, which highlights the unique role that fidelity bonds play in mitigating fraud-related risks for businesses.

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Health Insurance

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