A former police officer in Sanford gets his Class B agency license, hires six guards and signs his first two contracts within a month: overnight patrol at an apartment community and weekend access control at a shopping plaza. He buys a general liability policy online, adds workers’ compensation through a payroll service and figures the insurance side is handled. Four months later, a guard at the plaza detains a man he suspects of shoplifting, the man is injured in the struggle, and the claim is denied under an assault and battery exclusion the owner never knew was in his policy.
New security companies rarely fail because the owner doesn’t understand security. They get into trouble because insurance was treated as a box to check rather than part of how the business is built. The same handful of mistakes shows up again and again, and nearly all of them are easier to avoid at the start than to fix after a claim.
Assuming General Liability Covers Assault and Battery
This is the most common and most expensive mistake in the trade. Many general liability policies, especially those written for ordinary businesses, exclude claims arising out of assault and battery. Some exclusions are broad enough to reach claims that a guard failed to prevent an attack, used too much force during a removal or negligently supervised a confrontation, which together describe most of the claims security companies actually face.
A policy built for a security operation either includes assault and battery coverage or carries a defined sublimit for it, and the owner should know which. A new company should ask for that coverage by name and read the endorsement, not rely on a quote summary. Our article on assault and battery coverage explains how these exclusions are written.
Pricing Armed Work Like Unarmed Work
New owners often bid aggressively to win early contracts. When the contract calls for armed officers, the insurance cost can be very different. Armed operations are underwritten more closely, fewer markets write them, liability rates are higher and workers’ compensation is classified differently. A company that prices an armed contract using its unarmed insurance costs can find that the premium wipes out the margin. Getting a quote for armed work before submitting a bid avoids that surprise.
Treating Unarmed Work as Low Risk
The opposite mistake is just as common. Owners focused on unarmed posts sometimes buy minimal limits on the theory that no firearms means little risk. Wrongful detention, injuries during a removal, failure to respond to a disturbance and negligent security claims after a crime on the property do not require a firearm. Unarmed security is still a specialized, higher-hazard class in the eyes of insurers and plaintiffs’ attorneys.
Signing Contracts Before Checking the Insurance Section
Contracts from property managers, associations and commercial clients almost always include insurance requirements: specific limits, additional insured status, waiver of subrogation, primary and noncontributory wording, assault and battery coverage named explicitly and sometimes a fidelity bond or professional liability. New companies often sign first and ask their agent later. When the policy doesn’t match, the company either scrambles to buy coverage before the start date or issues a certificate that promises something the policy doesn’t provide, which creates a far bigger problem. Sending every contract to the agent before signing takes a day and prevents most of these issues.
Getting Workers’ Compensation Wrong
Florida requires workers’ compensation for most employers, and security guard work is classified separately from office work, with armed and unarmed guards often rated differently. New owners sometimes misclassify guards, rely on officer exemptions that don’t apply to the people actually working posts, or use 1099 arrangements for guards who are employees in every practical sense. Each of these shows up the moment a guard is hurt or a payroll audit is done, and the result can be a large additional premium or a stop-work order. Our article on workers’ compensation for security guard companies covers classification and exemptions in more detail.
Not Verifying Subcontractors
As a company grows, it often uses another agency’s guards for overflow shifts or events. If that subcontractor has no insurance, or has a policy with an assault and battery exclusion, a claim from its guard’s conduct will land on the company that holds the client contract. Getting certificates from every subcontractor, confirming assault and battery coverage and requiring additional insured status protects the primary company.
Skipping Documentation
Post orders, training records, license copies, daily activity reports and incident reports are the evidence a company will need when a claim arrives months or years after the event. They show what the guard was told to do, whether the guard was qualified and what actually happened. Building those habits from the first contract is far easier than reconstructing them after a serious incident, and insurers increasingly ask about them at underwriting.
Overlooking Employment Claims
Security companies reassign, discipline and terminate guards more often than most employers, frequently because a client asked for a guard to be removed. That creates a steady stream of employment practices exposure: wrongful termination, discrimination and retaliation claims based on decisions the company made with limited information. Employment practices liability insurance is often overlooked by new owners until the first demand letter arrives. Our EPLI guide explains what it covers.
Forgetting the Vehicles
Patrol cars, golf carts and guards’ personal cars used to drive between sites all create auto exposure. A general liability policy excludes auto claims, and a personal auto policy may not respond when a guard is driving for work. New companies with patrol vehicles need commercial auto, and companies whose guards use their own cars should look at hired and non-owned auto coverage.
Worth Confirming With Your Agent
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Whether your liability policy includes assault and battery coverage, and at what limit
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Whether your policy is written for armed operations if any post is armed
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Whether your guards are classified correctly for workers’ compensation
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What your current contracts require, and whether your certificates match your policies
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Whether you have EPLI, a fidelity bond and commercial or non-owned auto coverage
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How you verify subcontracted guards’ insurance before they work a post
This article is general information and is not legal advice.
Talk to Prestige Insurance Group
Prestige Insurance Group works with new and growing security agencies across Florida, and we help owners build a program that fits the posts they actually work, armed or unarmed. If you are starting an agency or taking on your first large contract, we can review your policies and contracts before the first claim tests them.
Call the office nearest you. Se habla español.
Orlando: 407-993-2331
Miami: 305-969-8776
Stuart: 772-247-3788
Prestige Insurance Group, License L057894
