What Is the Value of a Security System?
Every security system is a crime-fighting tool; that is where the industry’s efforts should be.
It is ironic that as security systems evolve into more sophisticated appliances, their value is becoming more muddled. On the one hand, a broader platform gives security dealers more hooks — lighting automation, energy management, and remote connectivity are a few — with which to sell to consumers. On the other hand, some believe that the “bells and whistles” built into today’s systems detract from security’s real value, which is to help stop crime.
Security systems originally were mandated for certain businesses in order to secure insurance coverage; so their value was tied to a financial incentive and the belief that the detection of an intrusion, coupled with fast response to the premises, could stem loss. For high-security installations, silent alarms were a popular method for catching criminals in the act. Intrusion detection and the possibility of apprehending criminals remained the key value of a security system for decades. As window decals and yard signs began to grow in popularity, another value emerged: deterring crime.
Despite the fact that no nationwide studies correlating alarm systems to a reduction in crime have ever been conducted, insurance companies historically have offered discounts on insurance premiums for having a security system installed. Although it is reported periodically that these discounts either have been reduced or are being phased out altogether, a February 2011 statement issued by the Electronic Security Association (ESA) asserted the contrary. “A survey of the 10 largest insurance companies offering homeowners coverage found premium discounts up to 20 percent if a home is equipped with a monitored alarm system,” said Dom D’Ascoli, ESA president. ESA’s statement went on: “The majority of insurance companies offer discounts for alarm systems,” said Michael Barry, spokesperson for the Insurance Information Institute.
As SDM reported earlier this year, broadband giant Comcast recently entered the security industry and a few weeks ago I heard the company’s radio spot promoting its Xfinity Home security offering in Chicago for the first time. To my surprise, the commercial cited “up to a 20 percent discount on your insurance premium” as part of its value-proposition. The commercial also cited “peace of mind.”
Peace of mind is a powerful component of a security system’s value. To some degree, today’s security platforms extend that with the capability for families to stay in touch through text message alerts, video look-ins, and the like. Many dealers even say that today’s security systems deliver a “wow” factor that their predecessors have long lacked — and why not be excited that security systems now can be as appealing as any other consumer electronic device?
Simply put, today’s alarm systems have a multi-faceted value proposition. But that still doesn’t necessarily take away from their primary goal: to reduce loss and fight crime. The insurance industry and the security industry have been linked in this issue for a long time. More recently, this link has been strengthened by the development of a new organization, The Partnership for Priority Video Alarm Response (PPVAR). (See related article by SDM’s Associate Editor, Sabrina Gasulla, “Video Priority Response Has New Champions,” on page 18.)
According to Keith Jentoft, president of RSI Videofied and industry proponent of priority police response to video-verified alarms, the insurance industry lately is more attuned to a security system’s ability to facilitate arrests, helping to keep insurance payouts and loss-related expenses down. In our cover story beginning on page 56, “Security & Crime,” Senior Editor Heather Klotz-Young quotes Stanley CSS’s Steve Walker as saying, “The insurance industry seems to view apprehension as having a much stronger impact on crime than simple deterrence. Deterrence has its place, but apprehension is a big thing for reducing the repeat offenders and lowering costs for insurers.”
Not every security system sold and installed today has the capability for video and/or audio verification of an alarm, which both aid in helping make criminal apprehensions. Still, every security system has the potential to be a crime-fighting tool.
As an industry we should be pleased that security systems bring so much value to the table — crime deterrence, break-in detection, peace-of-mind, savings on insurance, home automation, energy management, remote connectivity, and more. In the middle of all those valuable attributes, the industry should never lose sight of its founding value — the need that drove its invention — a security system’s ability to protect people and property and stop crime in its tracks.