Security Company Insurance
Getting security company insurance is essential.
Security companies need to protect themselves against a variety of different risks, such as those related to negligence claims, reckless behavior, and endangerment.
For example, if a security guard seriously injures a civilian while working for your company, you'll likely need to provide compensation.
We’ll help you find the most personalized and affordable coverage for your unique business.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for Security Guards
General liability insurance is — generally speaking — one of the best security guard insurance policies for security companies.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
Even so, your security guard company will likely benefit from purchasing additional insurance policies, including:
- Errors and omissions coverage: This protects you from negligent acts and/or omissions committed by one of your security guards.
- Commercial auto insurance: This will be legally required if you own a company vehicle (e.g., to transport security guards, etc.) and will cover vehicle-related damages.
- Business interruption insurance: This will cover part of your lost income in the event that you are required to temporarily shut down due to a covered risk.
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Cost of General Liability Insurance
The average security guard business in America spends between $500-$1,100 per year for $1 million in general liability coverage.
Check out the chart below for a snapshot of average general liability insurance expenditure across a variety of industries.
Several factors will determine the price of your policy. These include your:
- Location
- Deductible
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than a standalone one.
A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
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Common Situations That General Liability Insurance May Cover for a Security Guard Company
Example 1: As you’re doing a routine pat-down to a customer prior to a concert, you cause the customer to trip and seriously sprain their ankle. General liability insurance is available to cover the medical costs of the injury.
Example 2: While chasing down a suspect, you break several windows of neighboring properties and damage a public road sign. You can invoke general liability clauses to cover the property damage in the surrounding area.
Example 3: Another security company in the area sues you because your logo is similar to theirs. General liability will cover legal expenses, whether you decide to settle or fight the charges.
Example 4: You accidentally arrest or detain someone who was reasonably innocent. General liability can help you defend yourself against any charges or settle the claims without harming your company’s professional reputation.
Other Types of Coverage Security Companies Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:
Professional Liability Insurance
Professional liability is there to protect the company if clients feel they received inadequate services. If a security guard fails to act in a timely manner or fail to inform clients of an impending threat, professional liability insurance covers negligence claims. This benefit is especially handy because the service is subjective in many ways. Your employee may have a legitimate reason for failing to act, but the client (and potentially a judge) may have a completely different take on the matter.
Commercial Auto Insurance
Security guard companies that give their employees a vehicle will need to have a commercial auto insurance policy. This is mandated by the state to ensure you have coverage regardless of what happens on the road. Commercial insurance covers your vehicle and employees as well as other vehicles and drivers on the road. It also covers any additional property damage that may occur. For example, if a security guard accidentally crashes into a lamppost, you'll have the funds to repair that public property.
Workers' Compensation Insurance
If your security guard company has any employees (full-time or part-time), you are legally required to carry workers’ compensation insurance. This type of coverage will help compensate your employees in case they get injured on the job.
Commercial Umbrella Insurance
Umbrella coverage allows you to extend above and beyond the standard limits of your other business insurance policies. If you are faced with a large lawsuit or other claim situation, there’s a possibility that the coverage limits of your standard policies will be insufficient. In this case, your umbrella policy will allow you to surpass these limits.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your security guard company:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Security Guard Company Insurance FAQ
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
Generally speaking, yes. Getting business insurance will only be beneficial to you if it is done before liability arises, and this could technically happen as soon as you begin operating and/or interacting with clients.
If you purchase or lease a company vehicle, you will also likely be legally required to purchase commercial auto insurance.
Not necessarily. Certain exceptions may be written directly into your security company insurance policy, and some perils may be entirely uninsurable.
Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.