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Like many industries, security guard companies are now facing rising insurance premiums and increased coverage limitations. The primary cause of these challenges is the growing frequency of unpredictable claims and multi-million dollar settlements.
In 2021, a 12-story condominium building in Surfside, Florida, tragically collapsed. Securitas Security Services USA, Inc., the security company provider at the site, paid out a staggering $517 million settlement—almost half of the total compensation awarded. Contrary to common assumptions, the security company’s liability coverage was more significant than that of the property owner. The issue? The on-duty security guard failed to activate the building’s alert system, which would have initiated an evacuation. This tragic incident highlights a critical factor: the importance of thorough employee training.
Impact on Insurance Policies
Claims like the Surfside example have resulted in substantial changes within the security guard insurance market. Many insurers are now either exiting the market entirely or imposing higher premiums and restrictive coverage exclusions.
New Job Restrictions & Exclusions
Over the last few months, we have seen many insurance companies add jobs restrictions to their policies. Owners of Security Guard companies need to know and understand these exclusions and discuss them with their trusted insurance agent. Common policy exclusions of jobs for Security Guard companies include:
- Special events of more than 1,000, 2,000, and 5,000 people
- Inside retail
- Fast food or casual restaurants
- Janitorial or building maintenance
- Schools or educational institutions
- Cannabis
- Prison transport
- Bars, taverns, and clubs
- Work that includes more than 50% alcohol sales
- Executive protection
- Emergency room, hospital, or medical facilities
- Low-income housing, shelters, and temporary/ transitional housing
In additional to excluded jobs, we have seen limitations and/or exclusions to insurance policies for :
- Assault & battery claims
- Abuse & molestation claims
Understanding your policy’s coverage is crucial before an incident occurs. Aaron Jones, an experienced insurance consultant, specializes in security guard insurance programs. He and his team at TROXELL are equipped to guide you through this challenging market, providing access to a wide range of insurers and helping you mitigate potential risks.
Interested in working with a truly specialized insurance consultant in the Security Guard market? Contact Aaron today at ajones@troxellins.com or 309-585-6026.
This blog post was written by:
Aaron Jones, CLCS