Many carwashes are too often subject to vandalism, theft and other crimes, driving owners and operators to invest in high-quality surveillance systems and reliable insurance policies. Today, surveillance systems have evolved from blurry, black and white and often lagged video footage to high-resolution color videos with network-based cameras (IP) and Network Video Recorder (NVR) technology using the Internet to allow owners and operators to easily access the system’s data and receive notifications of potential security breaches.
Having a surveillance system in place not only can help record/report a crime committed at the facility, but it can also act as a good deterrent, stopping perpetrators, and even dishonest employees, from committing a crime.
Although the initial cost might be a bit pricey for a high-quality system, the return on investment and resulting peace of mind can be substantial, especially when considering the often ensuing low insurance costs.
“The claims history of any operation has a significant effect on overall insurance rates and the most effective means to minimize claims is to avoid them,” explains Dan Tharp, vice president of sales for The Insurancenter. “Installing an alarm system is one of the most prudent measures a business owner can take to manage risk and reduce the level of possible loss of life or property. Lowering your business' risk exposure and loss will help reduce claims and subsequently reduce premiums.”
In fact, continues Tharp, most insurance companies will offer a discount on insurance policy premiums if an appropriate, qualified alarm system specifically tailored to the business’ operations is installed and in some cases, insurance companies will require a security system to be installed before even insuring a business.
Choosing the right insurance policy
As mentioned, a good insurance policy should be developed based on the individual needs of a specific carwash. However, Tharp offers insight into a few general insurance policies to help steer owners and operators in the right direction:
- Business income: Helps to replace lost income due to a covered property loss, which results in a suspension or slow-down of operations suffered during the time to repair or replace the damaged property.
- Property: Proper valuation of all property is critical when setting limits for property coverage. This should include buildings, wash systems, vacuum systems, signs, inventory and all items used by the business. Deductibles should be set based on each carwash’s appetite to assume a portion of the risk.
- Commercial general liability: Protects carwashes against liability claims for bodily injury and property damage arising out of premises, operations, products and completed operations, as well as with coverage for advertising and personal injury. Limits should be set based on the needs of each operation.
- Workers’ compensation: Covers exposures arising out of work-related injuries sustained by an employee. Most states must follow strict guidelines to remain in compliance and avoid substantial penalties.
- Data breach: Provides coverage for the release of customers’ “personal identifiable information.” Even if your carwash utilizes the services of a third-party credit card system, a data breach policy would be recommended for any size operation.
Deciding which policy is best for your wash is a vital factor to consider, and furthermore, notes Tharp, “Equal importance should be given to the strength of the insurance company backing any policy and to the experience, knowledge and reputation of the agent designing the coverage.
“As insurance agents, we do not have any influence on the rates that our carriers charge,” says Tharp. “All we can do is partner with [customers] to determine where the greatest exposures (risks) are present, and then together we formulate a plan on how much of that risk [they] would like to retain and how much [they] would like to transfer to the insurance carrier. It is critical to only use an agent that is willing to spend the time to understand your operations and your industry.”