Why is insurance a must for security guards?
Working in the security industry comes with its own unique risks. But having the right security guard insurance coverage provides protection for accidental injuries, property damage, or unhappy clients. Plus, you may be required to carry some policies to comply with state laws or client contracts.
Get the right insurance
6 insurance policies every patrol service business should consider
These insurance policies protect against the most common risks and liabilities in the private security services industry.
General liability insurance
A general liability insurance policy defends against third-party injury and property lawsuits, such as a client who suffers an injury at your security business office. It's often required for a commercial lease.
- Client bodily injuries
- Accidental damage to a client's property
- Defamation and copyright infringement lawsuits
Business owner's policy
A business owner's policy, or BOP, combines general liability coverage and commercial property insurance at a discount. Low-risk small business owners are often eligible for this bundle.
- Slip-and-fall injuries
- Client property damage
- Business property damage
Workers' comp insurance
Workers' compensation insurance protects security companies and sole proprietors from work-related medical bills health insurance won't cover. Most states require coverage for employees.
- Medical expenses from workplace accidents
- Disability benefits for injured workers
- Legal costs from work injuries
Professional liability insurance
Professional liability coverage handles lawsuits related to mistakes, poor advice, or other accusations of professional negligence. It's also referred to as errors and omissions insurance or E&O insurance.
- Planning errors and oversights
- Client dissatisfaction
- Failure to deliver promised results
Commercial auto insurance
Almost every state requires commercial auto coverage for vehicles owned by a security firm. It covers financial losses and fees in the event of an accident involving your business vehicle.
- Auto accident legal fees
- Vandalism or other vehicle damage
- Vehicle theft
Cyber insurance
Cyber insurance helps planners recover from costly cyberattacks and data breaches. It's also called cyber liability insurance and is recommended if you store credit cards and personal information.
- Ransomware attacks
- Client notification costs
- Data breach investigations
Security guard insurance costs
Insurance costs for security guards vary widely depending on the specifics of your business.
Factors that insurance carriers consider when underwriting your premiums include:
- Security services offered
- Number of employees and additional insureds
- Value of your business property
- Types of insurance products purchased
- Coverage limits and deductibles
- Claims history
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Common questions about security guard and private patrol operator insurance
Review answers to frequently asked questions (FAQs) about security guard specialized insurance and more.
Do self-employed private patrol operators need insurance?
While insurance requirements for self-employed security professionals are rather lax, each state, municipality, and city may have their own requirements that must be met to work there.
In most cases, if your security guard company has employees, you'll be mandated to carry workers' compensation insurance in nearly every state. Workers' comp protects your business should a staff member become ill or injured on the job. This coverage is also a good idea for independent contractors and sole proprietors, who are typically exempt, as personal healthcare insurance won't cover work-related claims.
Additionally, patrol operators who drive company-owned vehicles must maintain the state-specified minimum amount of commercial auto insurance. It offers financial protection if you or your employees are involved in an accident with a business-owned vehicle, and will help cover medical expenses, property damage, liability claims, and uninsured motorists due to the incident.
Depending on your client, you may be asked to carry professional liability insurance (sometimes called errors and omissions coverage) before you can enter into an agreement with them. This is often true for government entities and local municipalities. Professional liability protects your business from expensive claims over the quality of your work.
Even when not required, insurance coverage is a critical component for any LLC, sole proprietor, independent contractor, and startup security guard services business. It not only offers peace of mind, but can protect your business from potentially devastating financial and legal costs.
What other types of insurance coverage do security service companies need?
For a comprehensive risk management plan, you may need additional protection to cover all the risks and liabilities your security guard or patrol services business may face.
Businesses in the security guard industry should also consider the following types of coverage:
- Hired and non-owned auto (HNOA) insurance provides business auto coverage for you and your employees if you or they drive a personal, rented, or leased vehicle for business purposes.
- Employment practices liability insurance (EPLI) helps pay for legal fees when an employee sues over a violation of their rights, such as wrongful termination, discrimination, or harassment.
- Directors and officers insurance (D&O) covers legal costs if an officer or board member is sued over a decision they made on behalf of your company.
- Commercial umbrella insurance activates to provide additional coverage when your general liability, commercial auto, or employer's liability policy reaches its limit on a claim.
Some additional coverage you should consider is a hold harmless agreement. Also called an indemnity agreement, this coverage is a contract for anyone who works with you agreeing they'll refrain from suing your business in certain situations.
