Every day, alarm and security installers protect properties, but who protects them? Recent headlines remind us that even the smallest mistakes can lead to significant liabilities. For example, a faulty smoke alarm recently resulted in a costly recall and ongoing litigation, emphasizing how critical comprehensive coverage is for installers.

For insurance agents, the takeaway is clear: alarm and security clients need specialized coverage beyond basic policies. Here are five critical areas often overlooked, along with a checklist to use when quoting Stone Falls’ tailored program.

1. False Alarm Consequences

Each year, millions of false alarms trigger costly fines. Cities like San Diego and Baltimore impose escalating penalties that can easily reach hundreds of dollars per incident.

Coverage gap: Many installers mistakenly assume property owners bear responsibility, but improper installation can shift liability to the installer. Standard policies often exclude municipal fines. Agents must ensure installers have coverage that addresses false-alarm fines or provides specific sub-limits.

2. Signal Failures and Liability

Missed or delayed alarm signals can lead to lawsuits against installers, even if equipment from third parties causes the failure. Courts frequently dismiss protective contract clauses in cases involving life safety.

Coverage gap: Traditional errors and omissions (E&O) coverage often isn’t sufficient. Agents should confirm E&O coverage aligns with worst-case scenarios, such as total loss from fires or other disasters.

3. Cybersecurity Threats

Cloud-based camera systems and digital panels expose installers to cybersecurity risks. High-profile breaches have resulted in substantial fines and legal settlements.

Coverage gap: Conventional policies typically exclude cyber liability issues like ransomware attacks or privacy breaches. Stone Falls offers comprehensive cyber-liability coverage tailored for security professionals.

4. Workplace Injuries and Vehicle Risks

Installation involves significant physical risks, including falls and repetitive stress injuries. Company vehicles loaded with equipment present theft and accident risks.

Coverage gap: Generic workers’ compensation policies may not cover higher-risk scenarios. Additionally, overlooking auto coverage for employee-owned vehicles used in company business can create substantial exposure. Specialized policies ensure these risks are adequately covered.

5. Property and Equipment Protection

Installers rely heavily on specialized tools and equipment vulnerable to theft, water damage, and power surges. Equipment breakdown can lead to costly operational disruptions.

Coverage gap: Standard property policies often underestimate replacement costs or omit coverage for off-site equipment. Policies should include off-premises property protection and equipment breakdown coverage that fully accounts for specialized diagnostic tools.

Agent Quoting Checklist

Before submitting a quote, gather these key details:

• Type of installations: burglary, fire, CCTV, access control
• Monitoring arrangements: third-party, in-house, or hybrid
• Service region and maximum installation height
• False alarm history: frequency and outstanding fines
• Cybersecurity measures: use of multi-factor authentication, firmware update protocols

Next Steps for Agents

• Share this article to demonstrate industry expertise.
• Provide clients with an appetite guide for pre-qualification.
• Offer contract reviews to strengthen client protections.

For assistance or detailed inquiries, reach out to our underwriting team. At Stone Falls, we’re here to support you every step of the way.