Insuring Your Business: Small Business Owners' Guide to Insurance

Businesses face various types of theft, including burglary and robbery by outsiders, theft by insiders and identity theft.

Burglary – Burglary refers to crimes involving the unlawful entry of a structure with or without force. Burglary prevention starts with making your premises an unattractive target by creating barriers to illicit entry. Appropriate measures will vary depending on the type of business, the premises and the location. For some businesses, security needs may be met simply by leasing a professional office in a building with good security and assuring there are strong doors and appropriate locks. This is particularly true for organizations in low-crime areas without high-value goods on the premises.

An enterprise in a building with numerous entrances and windows, located in an area with a high-crime rate and having high-value goods on hand presents a different picture. Whatever type of business you have, your insurance agent, locksmith, police department and a security consultant can provide information on how to make your premises harder to burgle. They may recommend such improvements as steel doors that fit tightly into doorframes, shatterproof window glass, stronger window locks and a fence around the premises.

Exterior lighting deters burglars. The fewer dark places around your facility, the better. Don’t let trees or shrubs grow around windows. These provide an opportunity for criminals to conceal what they are doing. Keep dumpsters away from the building.

Valuable property should be locked up to further deter theft. You may want to invest in an alarm system that rings in the police station or at a private security firm.

Robbery – Robberies involve the taking of valuables from another person(s) by force or threat of force. If you receive cash in your business, train employees what to do in case of robbery. Your local police department can assist you in developing training material. Limit the amounts of cash in cash registers.

Insider Crime – Many businesses put a great deal of effort into protecting their property from theft by outsiders but neglect to put an equal effort into preventing insider theft. Employers should not underestimate the risk of trusted employees stealing from the company.

Loss control experts at the Association of Certified Fraud Examiners (ACFE) encourage employers to adopt two strategies to prevent internal theft: increase the perceived probability of discovery and decrease the probability that an employee will commit the crime.

The ACFE recommends stringent accounting controls, which your accountant can help you create, and frequent audits. Having a policy that gives honest employees a way to report theft by their co-workers without fear of reprisal helps cut down insider theft, as does emphasis on ethical practices, rewarding company loyalty and having clear performance standards.

Identity Theft – Identity theft occurs when an individual uses someone else’s personal information to commit fraud. Federal law requires businesses to provide identity theft victims with transaction records relating to their identity theft free of charge.