Why do I need loss of keys insurance and how much cover do I need? This may be a question you find yourself asking after looking at your proposal form or insurance schedule or maybe you are concerned about the amount of keys your guards are carrying.
To put it into perspective, the cost of replacing a single lock can start at around $350 and go much higher depending on the quality of the lock that needs to be replaced. Now imagine that your guard lost the keychain containing 15 keys all to different sites. That cost can blow out to around $5,250. Now imagine that 3 of those keys were master keys which opened 5 locks each. Now we are looking at around $9,800.
Now imagine that you have just one master key to a factory or office building that opens 50 different locks or more. What about a school building? How many locks will the set of keys for that open? It is easy to see that a simple lost key can add up to a big claim very quickly.
A few years ago I had a client whose guard lost a single key to a small factory which ended up in a claim being lodged for $15,000 to replace all the locks and provide new keys to the factory. That was just a single key, the guard was carrying many more keys with him that night but thankfully only lost one. The claim could have been a lot higher had he lost the entire key chain.
Most security insurance policies include an automatic limit for loss of keys insurance however like everything else in this world, not all products are made equal and these limits can vary dramatically from some providers offering an automatic cover of $30,000 to other insurers offering as high as $250,000 and the average being $100,000
Now depending on the type of security that you are providing, you may not need a higher limit for loss of keys insurance or any limit at all for that matter. However if your guards are responsible for keys then this could be a major area of concern that you may have overlooked. After all, the whole point of buying the insurance policy is so that you are financially protected from things like this.
A good place to start is to look at the amount of keys you have in a single vehicle or patrol at any one time and evaluate how many locks can be opened with that set of keys. After counting up the locks, contact a local locksmith and have a discussion about the average costs of replacing that many locks and see for yourself how much cover you actually require.
You may be surprised at how much cover you will need if something was to go wrong. And just remember that the locks will need to be replaced urgently and quite possibly on a weekend which will increase the callout and service fees of the locksmith because if the building is robbed using the lost key, the claim against you could be much higher.
If you want any further advice about loss of keys insurance or what limits different insurers offer, please feel free to contact us for a chat. Having a quick discussion will not cost you anything but could save you everything.
