Security Professionals Need Professional Liability (E&O) Coverage

You perform your services with precision and reliability and you have complete confidence that your systems work as advertised.  You’ve never had any incidents.

But you still need Professional Liability insurance, also called Errors & Omissions (E&O) coverage.  No matter how well you perform your job, activating the customer’s system exposes you to additional risks that could be devastating if you’re not properly protected.

Helping Others Mitigate Risk… Can Be Risky

In this industry, companies face serious risks that could threaten the assets and financial stability of your business.  Whether you sell, install, monitor burglar or fire alarms, or other security systems, you have a great deal of responsibility for ensuring that alarms and monitoring services perform as promised.  At the same time, even if you have the benefit of a well written contract, if something goes wrong then you also face the potential cost of legal defense if a damaged customer brings litigation.  Professional Liability (also called Errors and Omissions insurance / E&O) protects alarm companies when they are sued for damage or injury allegedly arising from negligence in performing their professional services.

Don’t Assume General Liability Covers All

A mistake many alarm companies have made is assuming that General Liability (GL) insurance covers you in the event of a lawsuit for services rendered.  General Liability, by itself, will not normally cover losses arising from performance-failure of any programmed, smart, monitored or otherwise active electronic security systems: that’s beyond the intended scope of GL coverage.  Such a GL policy on its own would leave gaps in coverage that would not cover related claims.  This is where E&O comes in.

What Professional Liability Insurance Covers

Professional Liability / E&O insurance protects your business against actual or alleged errors or omissions that may have occurred during the rendering of service.  Claims like:

• Alarm system does not transmit signal, leading to a damage/injury
• Alarm system providing wrong or incomplete information, leading to a loss
• System failing to notify AHJ within a desired timeframe, leading to a loss
• Failure of system design to address all areas of customer property, leading to a loss
• Negligent programming leading to false alarms, resulting in non-response, leading to a loss
• Alarm sending false-positive signals leading to AHJ ignoring signals, leading to a loss
• Bodily injury at a premises where private security response is provided
• Damage to client’s property
• False arrest / detainment

Not every insurance program understands the needs of the alarm industry.  Eclipse Insurance provides comprehensive insurance and customized risk management solutions tailored to the electronic security industry.  Call us today for more information at 800-530-4448 or email info@eclipseinsurance.com