RBC Mortgage Co. v. National Union Fire Insurance Co.

**RBC Mortgage Co. v. National Union Fire Insurance Co. - Court Ruling Summary** **What Happened:** RBC Mortgage Company had purchased insurance coverage (called a "fidelity bond") to protect against employee dishonesty and fraud. When RBC had to pay settlement money to a third party company called EMMC, they tried to get their insurance company, National Union Fire Insurance, to cover these costs. The insurance company refused to pay, so RBC sued them. **What the Court Decided:** The court ruled in favor of the insurance company. Both the lower court and the appeals court found that RBC's settlement payments to the third party did not qualify as "direct losses" under their insurance policy. Since the fidelity bond only covered direct losses from employee misconduct, the insurance company was not required to reimburse RBC for the settlement costs. **Why This Matters for Workers:** This case shows how employer insurance policies work when there are workplace misconduct issues. While this particular dispute was between companies, it demonstrates that employers often have insurance to cover losses from employee actions. However, these policies have specific limits on what they cover, which can affect how employers handle workplace disputes and investigations.