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Security Guard Insurance: Insurance for Security Companies

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Over the course of this guide, we’re going to shed some light on what you need to know about security guard insurance. We’ll explore the cost of insurance for security companies, the types of insurance that security guard companies pay for, and review the top carriers for security guard company insurance.

Liability Insurance for Security Company

Liability insurance is one of the most common forms of coverage that security firms pay for. There are several forms of liability insurance for security guard companies such as general liability insurance, public liability insurance, and professional liability insurance.


General Liability Insurance for Security Guard Company

Security guard general liability insurance is a common inclusion in tailored unarmed and armed security guard insurance.  General liability insurance shields your security guard business against:

Coverage Function 
Third-Party Personal InjuriesYour security company’s operations will cause personal injuries to third parties. For example, someone might experience a trip and fall accident within the business premises and file a claim. In such a situation, general liability insurance will shoulder the medical expenses of the claimant
Third-Party Property DamageBusiness operations might also cause property damage to third parties. And so, general liability insurance reimburses the value of the damaged property if an aggrieved third party decides to file a claim  
Legal Defense General liability insurance will take care of attorney fees, administrative costs, court payment orders, and other legal costs if an aggrieved third party decides to take legal action upon sustaining personal injuries or property damage because of your security company 


Protection against personal injury claims and property damage claims is just a basic function of general liability insurance. But in truth, this inclusion in unarmed and armed security insurance covers other common exposures your security guard business faces such as:

Coverage Function
Reputational And Advertising Harm  General liability insurance has an optional advertising injury coverage. Advertising injury coverage will cover attorney fees, administrative costs, and  compensatory payments if a third-party files a slander, copyright infringement, false advertising, or libel claim against your security guard company 
Liability To Rented Premises General liability insurance is also useful if you’re renting or leasing a commercial space that acts as a security company headquarters where staff is hired, trained, and deployed. It has another optional coverage called rented premises liability. The function of rented premises liability coverage is to provide reimbursements on your behalf when fire damages the commercial space you’re renting or leasing and the landlord files a claim 
Personal Injuries or Property Damage Caused by a Completed Security Service Products and completed operations coverage is an optional protection in general liability insurance that mitigates financial losses if a completed security service causes personal injuries or property damage and a past client decides to file a claim 


So how much insurance money can you get from general liability insurance? General liability insurance provides $1 million - $2 million in coverage. However,  you will find insurance companies underwriting general liability insurance offering $300,000  - $500,000 minimum coverage. 


Public Liability Insurance for Security Guard Company

Public liability coverage is a more affordable form of insurance for security company than general liability coverage, making it popular for smaller firms. Since general liability covers more potential situations, it’s more of a risk for the carrier, translating to higher rates for the covered party.


The main difference between public and general liability insurance is that, compared to the latter, the former can’t be added with optional security guard insurance coverage.


Just like general liability insurance, you can get $1 million - $2 million from public liability insurance. And some companies offer public liability insurance having a $500,000 minimum coverage. 



Professional Liability Insurance for Security Guard Companies 

General liability insurance or public liability insurance is paired with professional liability insurance for the best protection against third-party claims. 


This type of security guard insurance takes care of attorney fees, administrative costs, compensatory payments, and other legal costs if a client decides to file a claim to hold your security company liable for economic or financial losses as caused by the following:

  • Negligence

  • Lack of training

  • Violation of good faith

  • Violation of fair dealing

  • Violation of confidentiality

  • Other acts considered errors and omissions 


The amount of coverage professional liability insurance provides is $1 million - $2 million. But note that depending on the policyholder’s business, insurance companies allow their professional liability insurance to provide $3 million - $5 million in coverage. 



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Commercial Property Insurance for Security Company

Another business insurance for security company is commercial property insurance. Commercial property insurance mitigates losses if something happens to your security company’s physical assets. By deciding to have this, you’re sure to recover when the following happens:

Building DestructionBuilding Damage
Commercial property insurance will reimburse the actual cash value or replacement cost of your security company’s commercial building if fire or extreme weather destroys it. Destruction caused by earthquakes and floods is excludedCommercial property insurance will reimburse the replacement cost or actual cash value of your commercial building’s structures that fire, theft, vandalism, and other covered perils destroyed


Commercial property insurance doesn’t only take care of your security company’s commercial building. The following are additional coverages that extend the protection provided:

  • Stocks and contents coverage - Stocks and contents coverage will recover losses if installations, office furniture, business records, and other valuable items inside your security company’s commercial building become lost or damaged due to fire, theft, vandalism, and other covered perils

  • Business equipment and tools coverage - Business equipment and tools coverage will reimburse losses if guns, stun guns, radio, flashlights, and other items used in security service becomes damaged or lost due to fire, theft, vandalism, and other covered perils


Actual Cash Value vs Replacement Cost

Commercial property insurance provides reimbursements based on the actual cash value or replacement cost of a scheduled property. In an actual cash value, you’ll receive money from commercial property insurance equal to the depreciated worth of covered business property. On the other hand, in a replacement cost, commercial property insurance provides money without taking the depreciation of a covered property into account.



Commercial Auto Insurance for Security Company

If your security company has an automobile used for a plethora of business activities, then get commercial auto insurance. Commercial auto insurance offers the following:

  • Auto liability coverage - Your security company is responsible if its vehicle causes an accident and injures third parties or damages properties. Auto liability coverage in commercial auto insurance assumes such responsibility and will pay for the medical expenses of injured persons

  • Physical damage coverage- Physical damage coverage will shoulder your commercial vehicle’s parts repair or replacement. It has two types - collision and comprehensive. Comprehensive physical damage coverage will take care of parts repair or replacement if your security company’s commercial vehicle incurred damage due to fire, theft, vandalism, hail, storm, and other covered perils. If your business’s commercial vehicle incurred damage after colliding with a vehicle or object, collision physical damage coverage will take care of parts repair or replacement

  • MedPay/personal injury protection - MedPay and personal injury protection will cover medical expenses if your security company’s vehicle caused an accident or got involved in an accident that resulted in injuries to the driver and the passengers.


Licensed firearms legal liability insurance is a specially underwritten insurance product available to security companies, independent security guards, military organizations, and law enforcement agencies.


This insurance will cover third-party personal injuries or property damage associated with an employee’s usage of a gun. For example, if an employee shoots a thief and this thief then files a claim, licensed firearms legal liability insurance will cover medical expenses on your company’s behalf. But note there are other perils covered namely:

  • Death - If an employee kills a person after using his or her gun for self-defense, licensed firearms legal liability insurance provides $20,000 - $35,000 as compensation if a claim is filed

  • Burial and funeral expense - Licensed firearms legal liability insurance also provides $10,000 - $15,000 coverage for the burial and funeral of the person who your employee killed out of self defense.

  • Personal accident coverage - If an employee of your security company injures himself or herself with a gun, personal accident coverage will provide $25,000 - $50,000 insurance money to cover medical expenses


Workers’ Compensation Insurance for Security Company

Having workers' compensation insurance is crucial if you want to run a security company legally. This kicks in when a security guard or any other employee of your company suffers from a work-related disease or injury. Workers' compensation insurance provides coverage for:

  • Medical treatment/procedure - If a security guard working for your security company gets involved in a shootout and sustains injuries, workers compensation insurance will pay for all the necessary medical treatment and procedure - surgeries, therapies, and more

  • Hospitalization - Workers' compensation insurance will cover bills if an injured or sick employee needs intensive hospitalization. Coverage applies regardless of where the employee is admitted

  • Medication - Workers' compensation insurance covers expenses for medicines and other substances the attending physician requires an injured or sick employee to take

  • Rehabilitation - Rehab might be needed especially if an employee experiences an illness or sickness that reduces the quality of life. In line with this, workers' compensation insurance will pay the costs for rehab such as therapist fees, equipment, and others

  • Lost income compensation - If an employee of your security company requests a leave to continue healing a work-related injury or illness, workers' compensation insurance will supplement lost income. The employee will receive a weekly allowance equal to two-thirds or 67% of the average weekly wage

  • Death benefits - Workers' compensation insurance takes care of funeral expenses and provides money to dependents if an employee of your security company dies due to a work-related injury or disease.


How Useful is Workers Compensation Insurance for Your Security Guard Company?

Security guards working for your security company face a lot of perils. It’s only a matter of time before they experience an incident that will result in injuries, illnesses, or even death. Here are some examples from the Occupational Safety and Health Administration.

Incident DateWhat Happened?
April 28, 2019The employee was working as a guard for a firm that provides security services to oil and gas companies. She was out and doing her job without a companion. She drove up to the entrance and was on the phone with the office staff. Witnesses said that she was driving her personal auto and parked the vehicle but didn’t kill the engine. As she was opening the door, the vehicle moved and ran her over. The person she was talking to saw what happened and came to her rescue. The security guard sustained bruises and a broken arm after the incident. She was taken to the hospital
March 27, 2006A security guard was patrolling on foot and was returning to his guardhouse. He was struck by an Evade Slam 1500 truck and tossed approximately 10 ft to the roadway. The injured security guard was hospitalized to heal injuries


Business Owner's Policy for Security Guard Companies

Many insurance companies offer tailored insurance for security guard companies and independent security guards in the form of a business owner’s policy. A business owner’s policy combines general liability insurance and commercial property insurance then includes other useful insurance products such as commercial auto insurance, commercial property insurance, cyber liability insurance, workers compensation insurance, or business interruption insurance. Since it already bundles different kinds of insurance under one roof, policy management is easier. Also, rates are cheaper.


Private Patrol Operator Insurance

This kind of armed security guard insurance is typically reserved for contractors and other solo operators, meaning that coverage of this type is often a lot more affordable.


As a private patrol operator, you don’t want to be held liable for a situation that was out of your control since it could potentially result in financial ruin or the loss of your job. Maintaining a valid liability policy will ensure that you avoid sticky situations that arise all too often in the security industry.




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Armed Security Guard Insurance Cost

The cost of armed guard insurance depends on a few different details about your business that the insurance company will obtain during the quote process. The most impactful factor that plays into the cost of your insurance is the size of your security guard company, with larger companies getting more expensive rates.


This is because larger security companies will be more likely to end up having to make a claim because they work with more clients and they have more security guards working at one time. If insurers were to charge large and small companies the same rates, they’d likely end up going out of business.


Another factor to account for is whether or not your security guards are armed with guns, since many insurance companies will charge much steeper rates because of the chance of serious bodily injury or property damage being done to members of the public. But expect to pay $105 per month or $1,260 per year for $1 million general liability insurance.


Here are some quotes we’ve gathered from the top companies in the armed security insurance industry:

CompanyCost per monthCost per yearBest for
CoverWallet $87$1,044Security guard insurance quotes comparison online
XINSURANCE$90$1080Clients looking for customized coverage
RLI Corp$112$1344Larger private security firms

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Best Security Guard Insurance Companies

When shopping around for security guard company insurance, it’s usually a good idea to check out the top companies in the industry. Due to the high level of risk involved in security industry, most policies are handled by specialty insurance groups that are used to working with security companies. That said, read the reviews below to know the pros, cons, and $1 million general liability insurance rate of the best options.


CoverWallet Security Guard Company Insurance


Pros

  • Security guard insurance quotes comparison online

  • Cancel a policy anytime

  • Pay premiums online

  • Free certificates of insurance

Cons

  • Not an insurance company but an insurance broker


CoverWallet tailored insurance for security guard companies offers four insurance options-general liability only, general liability and commercial property, business owner’s policy with workers compensation insurance, and a custom plan. Allow us to emphasize that this insurance broker’s commercial property insurance for security guard companies provides coverage for loss or damage of business assets, equipment breakdown, and lost revenues.


CoverWallet provides all the security industry insurance solutions company needs. Going for a custom plan is smart because you can get all the insurance products not available in other options.


Best for: Security guard insurance quotes comparison online

Average cost: $87

Our rating: 1/010


XINSURANCE Security Guard Insurance


Pros

  • Wide range of policies

  • Reasonable price

  • Many add-ons

Cons

  • Not available in some states


XINSURANCE exists to fill gaps in the insurance market by taking on high-risk clients that other carriers may not be willing to work with. XINSURANCE’s parent company is Evolutions Insurance Brokers, LC, and they work in the security, guard dog, and tattooing industries, as well as many more.


XINSURANCE’s security officer insurance is available for both armed and unarmed guards, and it can even be tailored to fit doormen. They offer policies for individual security guards working under contract as well as entire security firms, so they’re more than willing to customize your policy to your liking once you get in contact with them.


Best for: Clients looking for customized coverage

Average cost: $90

Our rating: 9/10


RLI Corp Security Guard Insurance


Pros

  • Key and lock replacement included

  • Higher policy limits

  • Coverage available in all 50 states

Cons

  • Expensive


RLI was founded in 1965, as Replacement Lens, Inc., and they were one of the first carriers to insure contact lenses. Since then, RLI has moved into other industries and they’ve actually sold off their contact lens insurance arm, focusing instead on casualty insurance and property coverage.

RLI’s security guard insurance programs are designed for larger private security firms and this is reflected in their relatively high policy limits. Their policies feature a limit of $1 million per occurrence but up to $5 million aggregate. Their policies also automatically include E&O coverage and key and lock replacement.


Best for: Larger private security firms

Average cost: $112

Our rating: 7/10


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