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Alarming Developments

Most businesses have some form of alarm protection and a significant number of these systems signal to a central station using BT’s “REDCARE” system.

Most Insurers are anxious to prevent both break-ins and arson attacks and so most Insurers insert  ‘alarm warranties’ into material damage policies. Put simply, warranties stipulate that alarm systems must be installed to a certain specification, must be adequately maintained and must be operational at all relevant times (when businesses are closed and/or unoccupied). The effect of breaching these warranties is simple: insurers will avoid claims.

BT has recently announced its intention to withdraw its REDCARE service effective from 1st August 2025. Some Insurers estimate there are over 100,000 REDCARE systems in operation. The shockwaves from this decision are difficult to predict. Will there be sufficient capacity in the market to replace all these systems before August 2025 or will the market be flooded with new offerings? Some of which may be unacceptable to insurers, we just don’t know. We do know alternative solutions must be found.

Many REDCARE customers will be unaware of the technological specifications delivered through REDCARE. Inevitably, it is an issue writ-through with jargon. AXA for example has indicated it will accept CSL Dualcom Gradeshift Pro DP3 or any dual path Alarm Transmission System with performance level DP3 certificated to BSEN50136-1@2012 – it doesn’t quite roll off the tongue, does it? Such systems must be installed by companies regulated by the National Security Council and maintained in full working order under an annual maintenance contract.

It is likely other Insurers will insist on similar specifications. Aviva’s requirements are fundamentally aligned to those of Axa. But, and it is a big but, individual Insurers will have differing approaches. In our experience, Insurers are unlikely to compromise on specifications and the cost of upgrading or altering systems in retrospect is to be avoided at all costs. Taking early action and getting it right first time are the order of the day.

As ever, we can help. We will continue to monitor developments and no doubt Insurers will develop their own strategies based on individual risk profiles, however, should you have any concerns, please do not hesitate to speak to your usual contact.

By Ian Laycock FCIIGroup CEO

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