General Liability Review: Paying less most likely means you have exclusions in your policy

General Liability Review: Paying less most likely means you have exclusions in your policy
April 25, 2016 GuardPro Insurance

At least once a week, I receive a phone call from a security guard company wanting to replace their current general liability insurance policy. Typically, they find out that their current policy excludes a large portion of their operations and contracts. The call I received this week, was from a guard company that had 100% armed guard/low-income housing contracts. When the insured took a closer look at his policy, he noticed the exclusion for low-income housing. I asked him to email me his policy so I could review his policy further. Upon reviewing the policy the exclusion clearly states that there is no liability coverage provided for Low Income, subsidized or affordable housing. Furthermore, the policy also had an exclusion for firearms! I was able to obtain and provide the insured with alternative liability quotes that included coverage for his low-income housing and firearms exposures. The premium to properly insure this security guard company’s exposure went up, but now this insured is paying for a policy that may actually defend him in the event of a general liability claim.

Unfortunately, these phone calls occur too often. When purchasing a general liability policy, the decision maker must look beyond the premium page. I would strongly recommend asking for policy forms of all exclusions.

This will allow you to read the exclusions so you can make the determination if the exclusion leaves the company liability to a claim that will not be covered. Of course, the best case scenario would be to have a trusted insurance broker that can properly explain to you the limitations of a general liability policy and the possible ramifications of the exclusions.

My advice to security guard insurance decision makers is to take advantage of an insurance broker that specializes in your industry. There are a handful of us that deal solely with security guards and there are a limited number of insurance programs providing coverage.

Of course, obtaining a most competitive premium is important to any business. However, you don’t want to save a little on premium at inception that ultimately leaves your company vulnerable to lose thousands of dollars in possible claim’s cost due to gaps in the liability policy.