property crime

Mitigating the risk of property crime

Taking active steps to protect investments and minimize losses
Monday, August 28, 2023
By Drew Fenton

City centres across Ontario are growing busier again as fear of a global pandemic recedes. Yet as people leave their homes to return to work and regular activity, the criminals have also returned. And while 2020 boasted the lowest property crime rate in more than 50 years, crime rates have not continued to sink since then.

For real estate owners and operators – especially those who manage high-rise condos in the city centres – the property crime rate is the one to watch. Although non-violent crime is down slightly across the province, the rate isn’t down enough to alleviate all concern.

Experts agree that organized crime is rising across Canada, and no one is even certain how many groups exist. Law enforcement struggles to prevent and prosecute those crimes, but property owners and operators are left to foot the bill – an expensive proposition in today’s uncertain economy.

As a result, building security is growing in importance. For example, common areas in condo towers house a variety of important spaces, including vehicle parking, storage lockers and bicycles, all under one roof. Offering the right security to protect these belongings – as well as their owners – goes a long way toward protecting your building overall.

Yet insurance coverage is no longer the simple proposition it once was. Underwriters are nervous about which buildings should be able to secure coverage. Property owners also can’t assume their buildings will be safe just because the neighbourhood is safe. They will need to take other steps to protect themselves and their buildings.

Today, property owners must face real estate crime head on by taking active steps to protect their investment and minimize their losses. These tactics work together as a single system, introducing risk mitigation practices and securing appropriate insurance coverage to protect you from the worst.

Here are five tips for increasing safety and security at your high-rise property:

Assess your property

Begin at the beginning; a thorough risk assessment will reveal any weak links and problematic issues, from great to small. Remember, even buildings in terrific neighbourhoods can be the focus of criminals. The risk assessment identifies improvements that building owners and operators can take to reduce the threat of crime, especially when it comes to increasing security.

Train employees

The most important component of building security is employee and resident safety. While staff members don’t need to also provide building security, they should be trained to ensure safety in case of a crime on the premises. If possible, hire extra security services to reduce crime, particularly if your building is in an area where law enforcement cannot respond quickly.

Bulk up

A building that creates the illusion of a bigger footprint can deter criminals as well. Add high-intensity LED lights in public areas and be sure you have sufficient outside lighting. Expand building security systems to include cameras in all public areas. Finally, perform regular maintenance on all security measures already in place, including locks, alarms, generators and backup systems.

Take advantage of technology

High-tech solutions can support building safety in a variety of ways. High-rise buildings benefit from electronic key cards and other barriers to entry. Visible security cameras and alarms discourage criminals, while silent alarms protect building staff. Finally, video surveillance and analytics software will help to provide a record that can be used to support a claim after the fact.

Secure real estate crime insurance

Many property owners rely on their general liability (GL) insurance to cover them in the event of a crime, but there are limits to what GL can cover. In fact, it only covers third-party bodily injury and property damage. Anything related to a crime must be covered by real estate crime insurance (CI). Property owners should determine a maximum allowable crime loss and ensure their CI coverage is commensurate with that amount.

All of these tactics, taken together, tell a risk story to the underwriters. By increasing safety and security, you demonstrate that your property is a “good” risk, securing appropriate insurance coverage in the process. Consult with your broker to see what your building needs to support a stronger risk story and secure appropriate coverage.

Drew Fenton is the Ontario Real Estate Practice Leader for Hub International.

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