Your clients place a great deal of trust in you when hiring your company to protect their businesses and property. In addition to extensive vetting of your employees through background checks and thorough training, your contracts with your clients clearly outline your scope of responsibilities and any warranties and/or guarantees you offer. However, mistakes and accidents still happen to the best of companies. An insurance policy can help defend you and your business in those situations.
Types of Security Professionals:
Private Unarmed Security Guards
Private Armed Security Guards
Private Detectives or Private Investigators (PI)
Armored Car Services
Private Security Contractors for Homeowners Associations (HOA)
Insurance Coverages Relevant to Security Guard Businesses
Commercial General Liability Insurance
This covers third-party claims for bodily injury and property damage. Personal injury claims such as libel and slander are relevant in the security business. This coverage helps pay the cost to defend you against such claims. For many businesses, this is typically your slip and fall type of exposure. A security business has much greater exposure and risk in this area while on their customers’ property.
Professional Liability insurance coverage for security businesses is similar to malpractice insurance for doctors. This has to do with the employees’ professional judgment, and a mistake in judgment can have significant financial impacts upon their clients. These types of claims are typically not covered by a general liability policy. This is especially important if you provide professional security advice or consulting services to your clients.
Types of Professional Liability Claims:
False Arrest or Failure to Apprehend
If a security guard wrongfully detains someone, and that individual has not been injured, this coverage is needed since the general liability coverage only responds to an injury. Failing to apprehend a trespasser or aggressor can also lead to a claim since the professional failed to fulfill their professional obligation to do the security work properly.
Damage to Client’s Property
If your security guard falls asleep on the job, or allows a thief disguised as an approved vendor to enter your client’s place of business, resulting in a property theft, this coverage would be necessary to defend you. This assumes you operated in line with best practices and took all actions to prevent unlawful entry.
Assault & Battery
If your business has foot patrol officers, and they fail to adhere to their scheduled routes, you could be faced with a claim should someone be assaulted during the time your guard was supposed to have been protecting them by patrolling that area of the premises.
Crime (Third-Party Employee Dishonesty)
Since guards often have access to their customers’ premises, this coverage is important to have for situations where your customers claim your employee stole their property.
Commercial Umbrella or Excess Liability Insurance
It’s not unreasonable to consider a liability claim that exceeds your policy limit. Having this added layer of liability coverage to step in when needed, and continue covering defense costs for you and your business, is a cost-effective means of managing this risk. Another layer of $1,000,000 may not cost as much as you would think. It’s worth considering.
If you own the building where your office is located, you’ll want coverage for that structure.
If your office is rented from a landlord, you may have contents (Business Personal Property) to insure, such as your furniture and computer equipment. If you don’t have an office, and all property is mobile and in transit, refer to the Mobile Equipment description below.
Mobile Security Equipment & Communication Devices (Inland Marine)
Mobile equipment such as radios, walkie-talkies, phones, and other items carried by guards or transported in their vehicles are often a target for thieves.
Business / Commercial Auto
Many security guard businesses offer mobile patrols. If your business responds to alarms, be sure your warranties and guarantees in your clients’ contracts provide sufficient time for your employees to get to the site safely without violating any traffic laws or endangering others.
This coverage is to protect your employees if injured while on the job. In Washington State, Work Comp is purchased through the Department of Labor and Industry. Stop Gap coverage should be considered in addition to the Work Comp policy, if in Washington State.
Employment Practices Liability Insurance (EPLI)
If your business or non-profit organization has employees, you should consider EPLI coverage, regardless of the size of your business. This insurance can protect your business against claims made by past, present, or prospective employees. It may also protect your business from customers, clients, and vendors if you include third party coverage.
Kristie English, M.Ed.
Principal / Agent
Does the type of business I offer security services to make much of a difference on my insurance premium?
Yes. There are many types of businesses and properties that are inherently higher risk. Of course each insurance company has their own guidelines, and those are subject to change at any time. Bars and nightclubs, retail businesses, and some types of residential properties have seen slightly higher rates and more thorough underwriting recently.
We're here to help you understand the best options for protecting your Security Guard business.
Call us at (833) BIG-TREE / (425) 673-7948, or use our online form to request a quote.