Whether you are required to have General Liability insurance or you chose to purchase the coverage for your business, do you know what protection it provides? Do you understand how it safeguards your business from sustaining losses that could bankrupt you? Let’s break down the parts of a General Liability policy and identify how those parts impact your business.
When you look at your insurance policy, you will notice something similar to the chart below.
The “Each Occurrence Limit” and the “General Aggregate Limit” both refer to losses that allege bodily injury or property damage. This one is pretty easy to understand. In the example above, the policy will pay up to $1,000,000 for a single occurrence and up to $2,000,000 over the course of the policy period.
Examples:
Assault and Battery – a security guard is accused of using more force than necessary to detain an individual resulting in injuries such as bruises, broken bones, internal injuries, etc.
Some policies will exclude Assault and Battery. Make sure that you know if your policy does or not.
Some policies will cover Assault and Battery, but at a separate limit such as $25,000/$50,000. In this case, a loss will be paid up to separate limit of $25,000/$50,000 and not the $1,000,000/$2,000,000.
While attempting to detain a suspected shoplifter, they accidentally knock over a display and all of the items on the display are broken. This would fall under the “property damage” portion of the limit.
While attempting to detain a shoplifter, the security guard not only knocks over a valuable display that is broken, but also causes the suspect to break his arm. While this is an example of a bodily injury (broken arm) and property damage (damaged display) the total between the two is considered one occurrence and subject to the limit of $1,000,000.
The next limit is Personal & Advertising Injury. This is a crucial coverage for a security guard to have because this is where defense for the following types of claims is found:
False Arrest, Detention, or Imprisonment
Malicious Prosecution
Invasion of Privacy
Libel/Slander
Copyright Infringement
Misappropriation of Advertising Ideas
False or Misleading Advertising
Claims under this coverage are covered up to $1,000,000 under the separate Personal & Advertising Injury Limit.
Products-Completed Operations Limit is one that is rarely used by Security professionals because it applies to injury or damage that occurs AFTER the security professional has given up possession or control of the work. The liability issues a security guard faces are usually arise while they are still providing their service rather than after they have left.
Examples of claims that would be covered under this limit could be:
The security professional installed surveillance equipment which months later malfunctioned. Due to the malfunction, suspects were able to get onto the property and commit multiple acts of vandalism which went unnoticed until the next day.
A security professional conducted a security audit and made recommendations which the client followed. Unfortunately, unforeseen circumstances occurred that led to a loss and people were injured at the client’s location.
Damage to Premises Rented to You is coverage for accidental damage to premises you are leasing. An example of a claim would be if you conducted training at your offices and during one of the physical defense training sessions, someone loses control and is accidentally thrown against a wall that results in a hole through the drywall. That damage is what this limit is designed for.
Medical Payments is designed to provide no fault coverage (regardless of your business being liable or not) for people who are injured either on your premises or as a result of your business operations. If as part of your patrol duties, you are responsible for identifying basic hazards and a visitor slips on some liquid that was spilled after you had already gone pass, the medical payments portion of your liability insurance could provide benefits even though it would be debatable if your security guard was actually liable.
As you can see, the General Liability policy provides quite a bit of coverage for a security professional. If you have no other insurance policies, invest in this one because the majority of what your security agency will be exposed to will be defended under this policy. Make sure to understand what is excluded with your policy by having a conversation with your insurance agent and by looking at the Endorsements section in the Declaration Pages.
These are all hypothetical examples of how your general liability policy would protect your security agency and any actual claim would need to be evaluated on its own merits by the claims professional.
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