Posted on July 8, 2022 by El Dorado
Alarm systems are an integral part of home and business safety: That also means they are more likely to be subject to liability issues when something goes wrong. Alarm installers face their share of lawsuits, too. Installation companies should always be aware of the risks and how to mitigate them, but it’s also a good idea to understand where lawsuits are coming from. Installers can sometimes be named in a lawsuit even if they had little to do with the situation. Here are the most common examples, and what to watch for!
Negligence In Contracts or Alarm Installation
These lawsuits claim that alarm installers were negligent in some way that led to specific kinds of damages. Sometimes, this is related to contracts – here’s a case where an alarm installer was found at fault because they waited on a signed contract and security deposit when doing work for an old friend (always get a signed contract before beginning work). Other lawsuits may claim that an alarm system was installed improperly so that it couldn’t do its job properly.
This is also a tricky area where installers can get roped into broader lawsuits. For example, if someone broke into a home and stole items while causing damage, the owner may sue both the alarm monitoring company and the alarm installer – they have an incentive to cast as wide a net as possible. This is one reason that thorough paperwork and quality installation work are important for every installer.
Misrepresenting What Alarm Systems Can Do
In these cases, installers may have made claims that were untrue regarding what the alarm system is capable of. Maybe they claimed an immediate response from a monitoring company when there was actually a delay – or in some cases, claimed professional monitoring when the service did not exist. Lawsuits may also claim that installers misrepresented what alarm sensors could do, or what the system could protect against.
Alarms That Don’t Function Because of Faulty Installation
This is a straightforward problem: Alarm systems were installed improperly and did not work, leading to a lawsuit. The system may not have been wired correctly in some cases, or devices may not have been properly paired with the security hub. If improper installation led to a fire or break-in that could have otherwise been prevented, that presents a serious liability issue for the installer. This is another reason it’s important to vet your employees!
Not Repairing or Replacing Broken Systems
This can be a gray area, but lawsuits have been settled for millions of dollars over it in the past. In our linked example, a hotel clerk tried to use a panic button that was part of the building’s security system, but it didn’t work. The alarm installation company was likely in a contract to provide maintenance services and had not repaired the system appropriately. Any type of ongoing maintenance, from replacing the batteries in security devices to replacing faulty system components, should be treated seriously. Repairs should be made quickly and appropriately for the system.
Keep in mind that some previous clients may also be angry if parts of their systems are aged out, as we saw when 3G alarm connections started losing service. While this may not be the fault of the installer, alarm companies can be easy targets when system features are lost.
Deceptive Sales Lawsuits
We discuss this elsewhere in more depth, but it’s a good idea to avoid the possibility of a deceptive sale lawsuit. This a broad category of lawsuits over fraudulent business practices that seek to get a sale by lying to potential customers or hiding fees. Sometimes even well-meaning installers can run into problems here if they practice door-to-door sales, have tricky “free” product offers, or represent themselves as employees of a particular security brand when they aren’t. Fortunately, this is also an easy type of lawsuit to prevent with straightforward and honest business practices.
Repeated False Alarms
False alarms can cause disruptions and annoyance, as well as leading to increasing fines from the city if law enforcement is contacted. Some owners may sue installation companies for improper placement or faulty installation leading to false alarms. This is typically difficult to prove, but it remains one of the more common types of alarm installation lawsuits.
Injury or Damage During a Response
This is another case where installers may get involved in a broader lawsuit that’s targeting as many entities as possible. In these cases, the monitoring system worked as intended and personnel were dispatched to the location. However, the incident led to injury or damage, which resulted in a lawsuit. As long as the alarm system performed as expected, installers may not have much to fear from these lawsuits.
Final Notes
If you’re concerned about your installation company facing a lawsuit, we have targeted coverage to help cover these situations. Additional coverage is available depending on the industries you work in and what specific kinds of lawsuits you may face. As usual, the best defense is being prepared and making sure both you and your clients are well-informed. It’s also a good idea to keep an eye on local regulations and building codes so you can make sure you’re avoiding liability issues wherever possible.
Source: El Dorado Insurance Agency, Inc.