Running a security company comes with serious risks like property damage, injuries, and even legal claims. Learning what insurance a security company needs can make a big difference since the right type can protect your business, your team, and your bottom line.

In this article, we’ll cover: 

• Why it’s necessary
• 6 types
• Choosing the right type
• Typical costs
• 3 Top providers
• Risk management strategies to help you lower costs

Let’s start by discussing why security insurance is necessary.

Why do security companies need insurance? 

Security companies deal with high-risk jobs every day when they’re protecting people, property, and valuable assets. That kind of responsibility opens the door to serious liability if something goes wrong. And sometimes, all it takes is one small thing.

Here’s what makes private patrol operator insurance a must:

• High-risk jobs: Guards often face confrontations, make judgment calls under pressure, and work in environments where injury or property damage can happen fast. For example, it’s important to get liability insurance for armed security guards, since they operate at a higher risk level.
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• Legal exposure: If someone gets hurt, property is damaged, or a guard is accused of wrongdoing, your company could be on the hook for costly lawsuits.
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• Client expectations: Many clients require proof of insurance before signing a contract. Without coverage, there’s a chance you could miss out on big opportunities.
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• Employee protection: It’s not just about protecting the business; you need to protect your team, too. Workers’ comp coverage helps take care of your guards if they get injured, while professional liability policies back them up if they’re accused of negligence.
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• Regulatory compliance: Depending on your state, certain insurance coverages are required just to stay licensed. Skipping insurance isn’t just risky, it could also cost you your ability to operate legally. It could also mean hefty fines, depending on where you operate.

What insurance does a security company need? 6 types to consider

Not all insurance policies are created equal, and security companies need more than just the basics. Depending on the jobs you take and the services you offer, some coverages may be legally required, while others help you avoid major financial hits.

Before we dig into each type, here’s a quick note on how we landed on the cost ranges and coverage recommendations.

We gathered pricing estimates from reputable insurance providers like Progressive Commercial and Trusted Choice, and also the research from HowMuch.net, along with business insurance breakdowns from industry guides and publications. These numbers reflect average costs for small to mid-sized security companies in the U.S. and are meant to give you a ballpark, not a quote. Final rates depend on your location, company size, services offered, and claims history.

Now, here’s a breakdown of the six most important types of insurance for security businesses:

1. General liability insurance or security liability insurance

This is the foundation of your insurance plan. General liability covers the most common risks security companies face on the job like third-party injuries, property damage, and legal fees if you’re sued.

Let’s say a guard accidentally knocks over a high-end speaker system while doing a sweep at a concert venue. The client sues for damages. General liability covers the repair or replacement costs (and your legal fees if it goes to court).

It’s not required by every state, but most clients will ask for it before signing a contract. That’s why it’s considered essential across the industry since not having this insurance can mean missing out on many opportunities.

Most small to mid-sized security companies pay between $3,000 to $4,000 per year, depending on coverage limits and risk factors like location and services offered. The best way to find out how much yours might cost is to shop around and ask for quotes, then compare each provider’s estimate.

2. Workers’ compensation insurance

This policy covers medical costs and lost wages if one of your guards gets hurt while working. It also protects your business from lawsuits related to workplace injuries. It usually kicks in when an employee gets hurt or sick from something that happens on the job. Furthermore, it helps cover their medical bills, lost wages during recovery, and even long-term care if needed.

For example, if a guard slips on a wet floor during a patrol and injures their back, workers’ comp would pay for their treatment and any income they miss while they recover.

Almost every state requires this coverage if you have employees, and skipping it can lead to big fines and legal trouble. Plus, it’s just a good thing to have worker’s comp insurance so you can take care of your employees when they need help.

On average, you’ll pay somewhere between $0.75 to $2.74 per $100 of payroll.

3. Commercial auto insurance

If your guards drive company vehicles, you’ll need commercial auto insurance, whether it’s for patrols, transporting equipment, or checking on job sites. Personal car insurance doesn’t cover business use, so relying on it could leave you exposed.

Let’s say one of your guards gets rear-ended while responding to a call. Your commercial auto policy would handle the vehicle repairs, medical costs, and any third-party claims.

This coverage is required in most states if your company owns or operates any vehicles.

Depending on the type of vehicles, where they’re used, and your claims history, expect to pay around $1,200 to $2,500 per vehicle per year.

4. Professional liability insurance

This type, which is also known as errors and omissions insurance, protects your business from claims that a guard or manager made a mistake, gave bad advice, or failed to prevent an incident they were hired to handle. It’s especially helpful in situations where clients allege negligence, even if nothing actually went wrong.

For example, say a client claims your team didn’t follow proper protocols during a break-in, and they file a lawsuit for damages. Professional liability can help cover legal costs, settlement fees, or court judgments.

It’s not always legally required, but it’s a smart move for most security companies, especially those offering high-risk or high-profile services.

Premiums vary depending on your services and risk level, but many companies pay somewhere between $500 and $1,800 per year.

5. Commercial umbrella insurance

Umbrella insurance gives you extra protection when a claim goes beyond the limits of your other liability policies. It’s not a standalone policy it’s more like a backup plan for big claims.

For example, if there’s a serious incident where a lawsuit exceeds your general liability coverage, you’d be stuck paying the difference out of pocket if you don’t have umbrella insurance. With it, you have a financial cushion that kicks in once other policies hit their cap.

It’s optional, but highly recommended for companies working in higher-risk environments or contracts with strict liability requirements.

Coverage usually starts at $1 million and can go much higher. Cost varies, but most businesses spend between $500 and $1,500 annually, depending on coverage limits.

6. Property insurance

If you own an office, storefront, or even just expensive equipment, property insurance helps cover damage from things like fire, theft, or vandalism.

Say a fire breaks out overnight and destroys your surveillance gear and laptops. Property insurance helps cover repair or replacement costs, so your business can get back up and running.

This coverage is typically required if you lease a space or finance any equipment.

Costs depend on what you’re insuring, the value of your property, and your location, but a ballpark figure for small businesses is around $1,000 to $3,000 per year.

10 key considerations for choosing the right security business insurance

Finding the right insurance for a security company is about finding coverage that actually fits the way you operate, the jobs you take on, and the risks your team faces every day. Here are 10 things to keep in mind when it comes to security company insurance requirements:

1. Assess your business risks and services: Start by identifying the types of services you offer, whether it’s armed or unarmed, patrol, or event security. Also consider whether your business is lower or higher risk. Your insurance should reflect the level of liability you’re exposed to so you can be protected in any event.
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2. Determine your coverage needs: Think about the risks you’re most likely to face and what kind of coverage would protect you if something goes wrong. Some clients might also require specific coverage types or limits in their contracts, so it’s a good idea to ask other firms in your area to see whether there are specific insurance types that are more common where you operate.
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3. Work with a broker who knows the security industry: Not all insurance brokers understand the challenges security companies deal with. Look for someone who specializes in your industry and can walk you through policy options tailored to your business. It’s a good idea to look at reviews or find someone through referrals.
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4. Compare multiple policy options: Don’t go with the first quote you get. Different providers offer different coverage terms, exclusions, and prices, so get at least three quotes before making a decision. It’s not a bad idea to go for as many quotes as possible before you start comparing.
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5. Understand exclusions and limitations: Every policy has fine print. Make sure you know what isn’t covered, like wrongful detainment, use-of-force incidents, or certain negligence claims, so you’re not caught off guard later.
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6. Choose the right coverage limits: Undershooting your limits to save money can backfire. Pick coverage amounts that actually match the level of risk your business takes on. Umbrella policies can help if you need extra protection.
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7. Ask about claims support: When something goes wrong, you want an insurer who responds quickly and helps you through the process. Look for companies that offer 24/7 claims handling and legal support.
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8. Bundle policies to save money: Some insurers offer discounts when you package multiple coverages together—like general liability, workers’ comp, and auto. Ask about industry-specific bundles built for security firms.
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9. Stay compliant with state and client requirements: Each state has its own insurance rules, and clients often have minimum coverage requirements. Double-check that your policies meet both, or you could risk fines—or lose a contract.
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10. Review your coverage every year: Your business might grow, take on new jobs, or hire more staff. It’s a good habit to reevaluate your policies annually to make sure they still match your needs.

The cost of security guard insurance coverage

Security insurance costs can vary a lot depending on the size of your company, what kind of services you offer, and where you operate. 

If you’re just starting out with a small team and limited equipment, your yearly costs might be on the lower end. But if you have a larger team, armed guards, or take on high-profile jobs, expect to pay more, both due to higher liability and more coverage requirements from clients.

Here are a few of the biggest factors that impact your insurance rates:

• Number of employees: More guards on staff means higher payroll, which drives up workers’ comp and liability premiums.
  
  
• Armed vs. unarmed services: Armed security tends to carry higher risk, so premiums are usually higher for those roles.
  
  
• Company vehicles: The more patrol vehicles you use (and the more miles they rack up), the more you’ll pay for commercial auto insurance.
  
  
• Past claims: If you’ve had a lot of claims or payouts in recent years, your rates may go up when you renew or switch providers.
  
  
• Coverage limits and deductibles: Higher policy limits give you more protection, but they also raise your premium. Opting for a higher deductible can sometimes lower your rate.

3 popular security business insurance providers

When you’re choosing insurance for a security company, it’s a good idea to work with providers that understand the unique risks you face. These companies offer strong claims support, flexible options, and experience with high-liability businesses:

1. The Hartford: A well-known name that’s been around for a long time. They offer bundled coverage and solid customer support — especially if you’re dealing with higher-risk jobs.
   
   
2. Philadelphia Insurance Companies: These folks have been ensuring security companies for years. They know the industry well and offer plans that include higher liability limits and legal backup when things go sideways.
   
   
3. Brownyard Group: A specialty provider that focuses specifically on security guard companies. Their plans are tailored for the kind of jobs you take on, whether it's patrol, event security, or high-risk contracts.

Simple ways to lower your insurance costs

Insurance is one of the biggest recurring expenses for security companies, but there are practical steps you can take to keep your costs under control. Most of them come down to managing risk and proving to your insurer that you take safety seriously.

Here are a few things that can help:

• Train your security guards regularly: Insurers love to see that your team is trained and up-to-date on safety procedures. Regular training reduces liability and helps your guards handle high-pressure situations in the best way possible. Focus on things like de-escalation, use-of-force policies, emergency response, and accurate reporting.
  
  
• Use safety tech: Technology can do a lot to protect your business and cut down on incidents. GPS tracking systems, surveillance logs, dash cams, and guard tour software all add a layer of accountability. These tools also give you documentation in case you ever need to defend yourself against a claim.
  
  
• Run thorough background checks: A proper hiring process goes a long way. Make sure you screen every new guard with criminal background checks, reference checks, and past employment verification. Insurers often give better rates to companies that show they’re careful about who they hire.
  
  
• Keep detailed documentation: Everything from training logs to incident reports should be clearly documented and stored. If you ever face a lawsuit or insurance dispute, strong documentation can be your best defense. Plus, it shows your insurer that you run a tight ship.
  
  
• Create and enforce clear policies: Written protocols help guards know exactly how to act in different situations. Whether it’s how to handle an aggressive person or when to call local law enforcement, having clear guidelines reduces confusion and liability.
  
  
• Ask about available discounts: Some insurers offer rate reductions if you’ve gone a year or more without a claim, or if you’ve adopted certain safety practices or tools. Others may offer lower premiums if you bundle multiple coverages together.
  
  
• Perform regular risk reviews: Every year, take a look at your company’s operations and spot areas where things could go wrong. Fixing small issues before they lead to claims can make a big difference in how your insurer sees you (and how much they charge).

Don’t stop at insurance, strengthen your security company with Belfry

Knowing what insurance a security company needs is only part of the equation. Protecting your business also means running optimized operations and preventing issues before they can turn into claims.

That’s where Belfry can help.

Belfry is an all-in-one security guard scheduling software that puts everything in one place, making it easier to manage your team.

Here’s how:

• Easy scheduling: Minimize scheduling conflicts and avoid unmanned shifts thanks to Belfry’s automated scheduling features that assign shifts based on site requirements, officer certifications, and training.
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• Increased officer accountability: Belfry has GPS tracking and NFC-based guided tours to help you make sure your guards are adhering to their post orders. Geofencing alerts help alert you if a guard leaves their designated area.
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• Digital incident reporting: Goodbye pen and paper — guards can more easily keep you up-to-date by sending digital incident reports through the Belfry mobile app. They can even attach any evidence if needed.
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• Track certifications: Prevent license compliance lapses by inputting your officers’ licenses and certifications. Belfry tracks renewal dates automatically and sends notifications when they’re coming up.
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• Simplified payroll: Belfry automates time and attendance tracking to make payroll easier. It also tracks overtime, labor expenses, and timesheets to make financial reporting a breeze.
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• Insurance compliance: It’s not enough to have insurance for security companies — your policies must stay up-to-date. Belfry can help you track when your security officer insurance renewals are coming up so you can avoid lapses.

See how Belfry can help you optimize your operations and reduce your liability. Schedule a Free Demo Today.