Accurately estimating the cost of security guard insurance for your security guard service is challenging because the price depends on so many factors. Like many commercial liability insurance policies, security guard insurance is not one-size-fits-all. The best way to save money on premiums is to work with an experienced insurance broker to design an insurance policy customized for your security business.
Factors That Impact The Cost Of Security Guard Insurance
Security guard insurance is a form of general liability insurance designed for companies that provide security services. The average cost of a standard general liability insurance policy for a small security business ranges from $87 per month up to $129 per month for $1,000,000/$2,000,000 general liability coverage.
But that is not necessarily reflective of what your premiums will run. Among the many factors that your insurance broker will want to know to give you a good quote are as follows:
One of the most important factors is the location of your business, and more specifically, the location(s) where your business provides security services. Some locations present higher risks—whether it is a high-crime or highly congested area, located in a high cost-of-living area, or some combination.
Size And Nature Of Security Services Provided
Security guard companies provide a broad range of security services. Some companies provide 24-hour motorized security patrols while others provide doormen in front of an urban multi-family residence or retail shopping stores.
Still, other services provide guards stationed at a guardhouse or in the lobby of a client’s building. Other services use electronic surveillance at a remote location and send guards out in response to alarms and calls from the clients’ premises.
Some larger, more specialized security services provide detailed threat analyses and prevention services. They may focus on preventing workplace crimes, industrial espionage, or cyberattacks.
Some services provide specially trained personnel who serve as bodyguards or armored truck guards or drivers.
In addition to the nature of the protection services your security guards provide, your insurance broker will need to know the number of guard hours that are worked per month on average.
Size Of The Company Workforce
It stands to reason that insurance coverage for a larger company will come at a higher cost than for a smaller company because a company with a larger workforce that does a higher volume of business is likely to experience more incidents than a smaller company.
Payroll and Business Income
A security guard company with a large payroll and generates a high level of income for the business will usually have more at stake than a smaller company. As such, the company may need a policy with higher coverage limits than a smaller company.
The company’s track record and the experience level of management are important factors in determining premium costs. If the company has been in business for many years, it probably has been well-managed to have been in business that long.
An established company with a claims history devoid of an excessive number of insurance claims compared to similar companies will pay less for its insurance coverage than companies with a less impressive track record.
In evaluating the company’s risk profile, the insurance broker will consider the experience level of key managers. If those individuals are experienced in the security services industry and have proven themselves responsible and capable, the insurance underwriter will factor in those details.
Guards Are Armed Or Unarmed
Many security guards perform their services armed with guns. Due to the inherently risky nature of providing armed security guard services, the premium cost for providing that service is higher than it is for unarmed security guard services.
Types Of Coverage
In addition to general liability coverage, your policy will likely need to include one or more of the following optional insurance policies:
- Professional liability
- Commercial automobile
- Workers compensation insurance
- Property insurance
- Premises liability
- Inland marine
Not every security guard business needs all of these optional coverages. For example, if your company has no employees, you won’t need workers compensation coverage. Likewise, if your guards do not operate a motor vehicle as part of their duties, you may not need a commercial automobile policy. The precise type of coverage your company needs depends on your company’s unique profile.
An umbrella policy provides additional insurance that could help to fill in any gaps in your coverage. In the event of a severe accident, injury or death, you can quickly reach the limits of your policy limits.
If that were to happen, an umbrella insurance policy will immediately kick in and help pay your company’s costs and your employees when they exceed $1 million.
Contact the Security Guard Insurance Experts at Southern States Insurance
The best way to keep the insurance costs for your security guard business as low as possible is to work with an experienced insurance broker. Contact Southern States Insurance for more information about the right insurance coverage for your security guard business.