High Risk vs Low Risk Contracts

High Risk vs Low Risk Contracts
April 15, 2015 BSGIns

Whether you are a new venture, or an existing and established Security Guard Company, it is important to be aware of the risk of contracts you obtain. Insurance carriers place contracts in two categories: Low Risk and High Risk. Some examples of low risk contracts are: retail, parking lots, office buildings, home associations, mid-high income housing. High risk contract examples are: schools, concerts, events, body guarding, bars/nightclubs/taverns, or any establishment that serves alcohol.

While there are multiple reasons why a contract may be considered high risk, typically it is because they tend to have more losses. We are more than able to obtain a quote for high-risk type contracts, but it the client should be aware of the minimum costs. Typically the minimum starting premium for high risk contracts is $15,000 – $25,000 annually (General Liability).

On the other hand, low risk contracts are just that, low risk. Insurance carriers see significantly lower losses, driving the minimum premium down. A good estimate of minimum starting premium for low risks contracts is $3,500 – $4,500 annually (General Liability).

If you are working a high risk contract, always be sure to speak with your broker to make sure you are properly covered for that type of job. If you aren’t sure whether your contract is high risk or low risk, feel free to contact us, or your current broker.