Crimes occurring on retail and residential real estate are a serious and growing threat to real estate owners, no matter where a property is located.

An increase in civil disorder and mass-theft incidents has made underwriters nervous about insuring certain properties. Surveillance videos often show large groups of criminals going on “smash and grab” retail thefts; the Coalition of Law Enforcement and Retail estimates that organized retail crime accounts for $45 billion in annual losses.¹

Law enforcement has had difficulty preventing and prosecuting these crimes. And property owners and operators that lack proper insurance are paying the cost of the crime itself as well as to defend themselves against any litigation following crimes committed on a property. 

Real estate crime insurance, prevention help minimize loss

Before underwriting against losses due to  will thoroughly investigate the safety and security of a given property. A high level of security increases the chance of a lower quote at renewal.

Here are five things real estate owners and operators can do to increase safety and security, and ensure they are properly covered in the event of a loss:

1. Conduct a property risk assessment. An owner may think because their building is in a safe area that it isn’t vulnerable to crime. However, many different elements other than location factor into crime risk. A property risk assessment will identify the security aspects that need improvement to improve crime prevention.
2. Implement technology. Residential high rises and commercial offices can install barriers to entry such as electronic key cards. For retail, security cameras and alarms can discourage criminals, while silent alarms that alert authorities can protect employees. Additionally, video surveillance and analytics software will, at the least, provide a record of stolen items in submitting a claim.
3. Train employees and add personnel. Employee and customer safety is the most important element in security. Staff, whether at retail or commercial properties, should be trained to ensure safety in case of a crime on the premises. In addition, hiring extra security services and guards can also reduce crime, particularly important in areas where law enforcement cannot respond quickly.
4. Improve the property. Expanding building security systems and adding high-intensity LED lights in public areas can dissuade criminals. Maintenance is also important: A building owner can have a crime claim denied if locks, alarms, generators and backup systems aren’t working properly. In addition, it helps to position customer checkouts stationed near the exit, properly position mirrors and security cameras, and post signage that outlines the consequences of theft.
5. Consider Real Estate Crime Insurance. Many property owners believe that General Liability (GL) insurance will cover all losses stemming from crime, but GL insurance only covers third-party bodily injury and property damage. Real estate Crime Insurance (CI) specifically covers losses related to crime. Property owners should determine a maximum allowable crime loss and ensure their CI coverage is commensurate with that amount.

Contact HUB’s real estate insurance team for more information on deterring crime and assessing the risks for building owners and operators.

¹ Senate Committee on the Judiciary, Testimony of Brendan P. Dugan, CFI Director of Organized Retail Crime and Corporate Investigations, CVS Health, November 2, 2021.