Alarm monitoring centres are places where trained operators handle alarm events. Sometimes, these centres are staffed by employees of home security providers. In other cases, they are third-party companies subcontracted by security companies, makers of personal medical alerts, and similar companies.
One of the most important things central station monitoring companies should do to protect themselves from potential damages and lawsuits is to have the right insurance. But how do third-party commercial monitoring stations differ from residential monitoring in terms of their requirements? This article will address the unique requirements for third-party commercial insurance monitoring.
High Insurance Limits for High-Value Property Companies
Canada’s security sector is a 3 billion dollar industry, with nearly 3,900 businesses nationwide. (1)
Compared to residential monitoring, commercial monitoring requires the monitoring of assets of much higher value. Therefore, commercial monitoring stations need much higher insurance limits to suit the greater level of risk they assume in case of a claim. Limits will depend on how many commercial properties the alarm monitoring company monitors, as well as the size of the company.
Monitoring Stations Need Specialized Insurance Coverage
If you are a broker serving monitoring centres and other clients in the security sector, here is what your clients will need to carry. At the very least, monitoring centres require general liability and professional liability coverages to insure them against bodily injury, property damage, and financial loss, as well as errors and omissions liability.
Following is a breakdown of the specific coverage requirements.
Advertising Claims
General liability insurance can also protect security companies from advertising claims made against them by competitors.
Say for instance a competitor feels that your client’s advertising is similar to theirs and the client wants to run an ad. Liability insurance can cover the claims process as well as any subsequent damages.
Bodily Injury
A third-party bodily injury policy can protect a monitoring station if someone gets injured at the place of business. A dealer, for example, could trip down the stairs at the company and become injured. General liability coverage helps cover the cost of any injuries sustained by the business in case of an accident or fall.
Third-Party Property Damage
Additionally, general liability will cover damage to third parties’ property in the event an employee damages theirs. Consider the case of a technician being sent to the property of a dealer and accidentally damaging the adjacent building with the equipment they are using. General liability helps cover the costs.
Professional Liability
Professional liability insurance protects your client against financial losses caused by their employee’s statements. Professional liability is a very important aspect of alarm monitoring, but many third-party companies do not have it.
For example, suppose the sales representative from your client tells one of their customers that if they have their alarm monitored, it will minimize the chances of burglary. One week later, the customer’s property is burglarized, valuables are stolen, and so the customer sues the monitoring company for misleading them into believing that buying the service would prevent these events. By having this insurance, your client’s business will be protected against such events.
About SWG SECURE
SWG SECURE Security Services Insurance provides coverage not normally offered by traditional insurers. Businesses that provide security guard services, private investigators, alarm systems, and locksmiths as well as others requiring entry to private living quarters, need a unique type of protection.
Our program takes into account all factors relevant to your client’s situation, helping to avoid unpleasant surprises down the road. You can trust us to evaluate the complete risk picture, offering coverage for all potential exposures, including failure to perform, design errors and omissions, bodily injury, advertising liability, legal expenses, property damage, and a host of other circumstances.
You may have turned down this type of high-risk client in the past, but with South Western Group’s support, you can provide a wide range of coverage options at fair and competitive prices.
Coverage Highlights
Commercial General Liability (Occurrence Form):
● Failure to Perform
● No General Aggregate Limit
● Contractors Errors & Omissions
● Bodily Injury and Property Damage – Broad Form
● Personal Injury
● Intentional Injury in Defense of Personal Property
● Products & Completed Operations
● Care, Custody and Control
● Legal Expense & Defense Cost Reimbursement – $25,000 Each Occurrence; $25,000 Annual Aggregate
● Advertising Liability
● Non-Owned Auto (including physical damage)
● Incidental Malpractice
● Contingent Employers Liability
● Fire Extinguishing Agent Release
● Employee Benefits Liability – Claims Made – $1,000,000 Limit
● Employees as Additional Insureds
● Tenants Legal Liability – $250,000 Sub-Limit
● Lost Key Cover – $50,000 Sub-limit
● Product Recall Extension – $25,000
● Medical Payments – $25,000 each person; $25,000 each accident
● Limited Pollution Liability Extension $1,000,000 Each Occurrence & Aggregate
● Blanket Additional Insured’s Clause
● Owners and Contractors Protective coverage
Other coverages available:
● Property Insurance
● Business Interruption – Profits/Gross Earnings/Extra Expense
● Crime Coverage – Employee Dishonesty – Form A
● Fidelity – third party feature
● Employers Liability
● Mechanical Breakdown
● Errors and Omissions – Claims Made – $250,000 Limit Each Occurrence; $250,000 Annual Aggregate (higher limits available)
We cover:
● Alarm and Security Installers, Manufacturers and Distributors
● Monitoring Stations
● Portable and Fixed Fire Suppression Systems (excluding sprinkler)
● Private Investigators
● Security Guards
● Concierge Services
For more information, visit our product page: https://swgins.com/product/swgsecure.html
Content is current as of the date of broadcast and is subject to change without notice.
Sources:
- https://www.ibisworld.com/canada/market-research-reports/security-alarm-services-industry/
