As the world progresses, so do the threats to people's safety. In South Africa, we are seeing an increase in the number of sophisticated and well-resourced criminals. This has resulted in a demand for higher security measures such as employing private security services. The private security industry in South Africa is a growing industry with a lot of potential. This industry is worth an estimated R45 billion and employs over 550,000 people. Several different businesses fall under the private security umbrella, including alarm companies, private investigators, and security guard companies.
Security companies face various risks daily, from break-ins, fire, vandalism to employee theft and property damage. While security companies are in the business of protecting other people and their property from potential harm, it is also vital that they also protect themselves, their staff as well as their property from loss. Insurance has several benefits; it provides peace of mind and protection in the event of an unexpected loss; it can help to offset the costs of repairs or replacement of damaged property and it can help companies preserve their reputation, ensuring that you keep your business running smoothly and prevent financial hardship.
Some of the most common insurance must-haves for private security companies include:
Most security companies have a vehicle pool with numbers going into the hundreds, and the use of these vehicles come with many risks, ranging from vehicle damage, theft & third-party liability. Motor fleet insurance is a type of insurance policy that covers a fleet of vehicles, which is defined as 2 or more vehicles, and this type of insurance is key in ensuring the smooth flow of operations for a security company.
A company with a national footprint could likely have hundreds of vehicles spread across all nine provinces. These vehicles are constantly on the road carrying out the daily business of the company, including conducting site visits, personnel deployment, private escort services and CIT activities. Covering each vehicle on a separate policy would require the business to run multiple policies with different driver details and risk profiles, resulting in different premiums. Covering your vehicles under a motor fleet cover eliminates this administrative burden. The company will have one policy and pay one premium amount while covering all their vehicles.
A fleet policy can also incorporate optional value adds such as:
As one of the key covers for all private security companies, this insurance protects the company against legal liabilities for damages or losses incurred during the security personnel carrying out their security duties. These could be bodily injury, property damage and wrongful arrest. These services ought to be carried under the provisions of the Standard Conditions of the Contract between the security company and the 3rd party (their client).
Sometimes carrying out security duties involves the use of firearms. In such cases, it is critical for companies to disclose this to their insurers so that the cover caters for liabilities from use of firearms.
Over the years, we have seen that most theft incidents involve collusion between the perpetrators and the security personnel on site, either by the personnel providing inside information to perpetrators or actively participating in the robbery on sites they are meant to be protecting. This places the security company that has employed these individuals at risk of being held liable for damages and reputational damages as well. Owners should ensure that they are adequately protected by extending their liability cover to include the involvement of its own personnel in damage or loss of third-party property.
One of the most important types of insurance covers for businesses and individuals that protects against claims for bodily injury or property damage arising from security business activities. Public liability insurance can help cover the cost of legal fees and any damages that may be awarded if you are found to be at fault for an accident. If you are unsure whether your business activities would benefit from public liability insurance, it is always best to speak to an insurance broker or advisor.
Employer's liability insurance is a type of insurance policy that protects companies from the costs associated with illnesses, injuries, and deaths resulting from workplace accidents. Employers’ liability insurance shouldn’t be confused with workers' compensation insurance, which covers the medical and income replacement costs for employees who are injured at work and where, in most cases, businesses are bound to have workers' compensation insurance. Employer's liability insurance is designed to cover damages that fall outside of workers' compensation.
For example, if an employee is injured in a car accident while on the job, workers' compensation would cover the medical costs and a portion of the lost wages. However, if the employee sues the company for negligence, employer's liability insurance comes into play. In this instance, the company can use their Employer's Liability Insurance to fight the claim in court or to avoid litigation by compensating the employee.
Employers Liability Insurance does not cover legal fees, sexual harassment cases, or discrimination, however, it is vital to any business's risk management strategy. Accidents frequently happen in the security industry, and when they do, it's crucial to have financial protection in place to cover the costs.
This type of insurance covers you and your employees for any legal liability arising from your professional activities. It can protect you from negligence claims, errors, or omissions in your work. Professional indemnity insurance is vital for any business, but it is especially crucial for companies that provide security or protection to clients. If your business gives advice or provides security consulting services, you could be held liable if something goes wrong.
For example, let's say one of your clients hires you to protect him or his property. You develop a security plan and present it to the client. They decide to go ahead with the plan, but it fails, and they lose money. They could sue you for negligence.
If you had professional indemnity insurance, your policy would cover your legal defense costs and would also pay any damages that you were ordered to pay.
Professional indemnity insurance is not a compulsion by law, but it is a good idea to have if your business provides advice or security consulting to clients. Knowing that you are protected from potential legal liabilities can give you peace of mind.
Alarm systems are a must for modern private security companies, but they can be expensive to install and maintain. CCTV cameras are another excellent security measure, but they, too, can be costly. Insurance can help offset the costs of alarm systems and CCTV cameras in case of any mishap.
This type of insurance protects the assets of the security company at their various offices against damages or losses. These assets will include electronic items like printers, two-way radios, office contents, buildings, and computers.
Private security companies can also access policies to protect themselves against:
If you think this is complicated, you can contact Afric Cover. As an Insurance Broker, we can walk you through insurance policies' complex but essential landscape to help you get the best deal.
Get in touch and get the burden off your shoulder with simple yet effective solutions now!
