Having to secure a license to install burglar alarm systems is often the primary reason CE pros do not enter that business.
C.O.P.S. Monitoring, with facilities in New Jersey, Florida and Arizona, is the second largest third-party central station monitoring company in the industry, with approximately 500,000 accounts and more than 3,100 independent alarm dealers from all 50 states (plus Canada and Barbados).
Don Maden, executive vice president of C.O.P.S. Monitoring, answers some key questions about what it takes for integrators to get alarm licensing.
Alarm licensing varies state to state, but is it difficult to obtain?
In general, I think it is more the process that is discouraging to companies considering the alarm industry. There are, however, tougher states. Some of those include Illinois, Florida, Texas and Virginia.
(Editor’s Note: The Electronic Security Association has full details on alarm licensing requirements on a state by state basis. Currently, 37 states plus the District of Columbia require some form of burglar alarm licensing. It can be as simple as a contractor’s license (Nevada) or stipulate licenses solely for fire alarms (Vermont) or monitoring (Oregon), but not for installation. States that do not require licenses to install alarm systems are Indiana, Iowa, Kansas, Kentucky, Mississippi, Missouri, New Hampshire, North Dakota, Ohio, Pennsylvania, South Dakota, Vermont and Wisconsin.)
How often do licensing requirements change?
It is quite dynamic. Dealers should contact their local municipality directly to get definitive information. I would say we learn of new permit/registration requirements almost every week. I would also suggest that, as a way for integrators new to the security market to differentiate themselves, they assist subscribers in the permitting process, because if this is not done promptly and properly, the subscriber may get a fine or lose police response – and may ultimately cancel the monitoring contract.
What are some typical requirements to get licenses?
Corporate filings/registration, insurance policy minimums (General Liability, Errors & Omissions, workman’s comp), background checks, field/industry experience, initial training/testing, employee level registration/ID cards, surety bonds/letters of credit from a financial institution, applicable fees, display of license number on advertising, sales tax, continuing education and more. I am sure there are other items.
Perhaps it is comparable in many ways to being a licensed electrician, but I would think the alarm training is not as intense. In many states, an individual is held responsible as the compliance agent/license holder for the company, and this must be in place before the company can get its license. In some cases, you can actually hire an independent compliance agent/license holder. (There are companies who help you find these license holders.)
Are security licenses more difficult to obtain than high-voltage electrical licenses? Why or why not?
I am not sure that they are. The greatest obstacle may be the industry experience. In some states, having the high-voltage license covers the low-voltage (alarm) end.
Why do states require security licenses?
Many claim it is for regulatory issues, with emphasis on consumer protection/safety. Sometimes, though, it is to provide a significant barrier to entry [to prevent new companies from entering the field].
How does a third-party central station like C.O.P.S. help lessen the liability on an integrator installing security?
Dealers do not need to take on the burden of central station licensing and all associated requirements, which in many states can vary from the alarm company license. Plus we are a UL Listed, FM Approved – and highly insured – central station.