Security services industry insurance is designed to encompass a wide range of coverage requirements from security guards, private investigators, alarm installers and monitoring stations, to CCTV installation, sprinkler contractors and fire alarm services.
Security guards have also seen a lot of growth in Canada, with many businesses and properties like condominiums employing them for perimeter security and concierge as well as some telephone answering servicing.
In this diverse range of service providers, the biggest hurdle for brokers is getting the insureds to understand what type of coverage they need and why. According to Corinne Love, insurance underwriter at South Western Group Insurance that problem has been largely solved with more and more mandates coming down from provincial regulators and bodies like the Bureau de Securite in Quebec and the regional regulator in Ontario.
Love notes that alarm installers need to have CGL and include a failure to perform coverage. “We’re also more and more getting into the fact that people are consulting for fees which takes an installation out of the encompassing design and coverage offered by failure to perform and so they’re now needing E&O insurance,” Love says. “So we’re including a $250,000 E&O coverage, but they can upgrade that to $1m or $2m.”
But Love notes that one of the main hurdles is not only explaining why insureds need a failure to perform cover, but that it actually needs to be written on the cover sheet versus a silent clause on a GL cover note.
Burglar alarm installed by insured failed - 3rd party suffered burglary
Loss Paid - $25,000