On Guard! The day after his chemical company was burglarized, Don Anderson had an alarm system, new locks and extra lighting installed. He has not had a problem in the seven years since.
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Anderson, 41, the owner of Carlyle Products Inc. in Greenville, South Carolina, says he thought about getting better security before the break-in happened but just didn't make the time. "You really feel violated when you walk in and see something you've been working for gone," says Anderson, who projects 2008 sales at less than $1 million.
To protect your business from crime, implement crime prevention strategies and have insurance in case deterrence doesn't work. David C. Moss, a risk advisor with Burkey Risk Services Inc., recommends consulting with your insurer or agent to develop a sound risk management program. The basics, such as alarm systems, secure locks, interior and exterior lighting, and surveillance cameras, are good starting points, Moss says. But, he adds, "If you're going to spend the money, make sure all your bases are covered."
Establish and enforce policies that will prevent crime. Know whom you're hiring by conducting pre-employment background checks. Give keys only to employees who need them. Set up internal controls so that checks must be countersigned and cash is never counted by one person working alone. For alarm systems, train employees on proper use and restrict who has access to codes. Position surveillance cameras so they have a clear view of each place a crime might happen, such as cash registers and safes, as well as entrances and parking lots. Post signs warning that alarms and cameras are in use. "It's all about reducing your risks," Moss says.
Review your assets with your accountant so you know the value of what you have, then sit down with your insurance agent to determine the exact coverage you need in terms of type and amount, Moss advises. For most companies, commercial crime and employee dishonesty insurance are good starting points and may even be sufficient. Commercial crime insurance typically covers losses due to theft by perpetrators outside your company. Employee dishonesty coverage protects you from theft by your employees.
You may also opt for specialty coverages that you can add by endorsement. For example, forgery or alteration insurance covers losses due to the forgery or alteration of checks, promissory notes and other financial instruments. If you keep cash or securities on hand, you may want special coverage for them. Or you might consider kidnap, ransom and extortion coverage if you could be a target of these types of crimes.
Crime prevention and insurance work like a bulletproof vest for your company: It doesn't mean you won't ever get shot, but you're more likely to survive if you do.
Jacquelyn Lynn is a freelance business writer in Orlando, Florida.
