In the past 18 months, the Jubilee Insurance Program has experienced some unusual and quite large losses involving master keys and locks.  In a continuing effort to reduce claims in your reciprocals and help control premiums, our article this month deals with keys and locks and the need for a Key Control Policy.

Many of our Members use a system of master keys, for obvious and practical reasons.  If you have a large number of buildings, rooms and suites etc., it is much easier for maintenance personnel and/or users that require access to these units to access them by use of master key(s).

It is not our intent to discourage the practice of the use of master keys; however, we would like to bring to everyone’s attention some issues that go along with the use of master keys.  These issues bring with them the following security, safety and property exposures and the associated costs:

  1. The cost of replacing or rekeying the locks which can be very substantial depending on the number of  locks requiring rekeying
  2. One actual example is where a keyset containing multiple master keys was stolen from a vehicle resulting in replacement /rekeying of locks - estimated cost of loss $60,000; 
  3. The potential for theft and/or vandalism of member property;
  4. The potential for theft and/or vandalism of tenant/renter property;
  5. Personal injury to employees or tenants, thus creating a liability exposure even greater than the potential property damage;
  6. Uninsured loss in terms of Member time spent in rectifying the problem, and dealing with the stressed individuals who have been affected;

Whether you make use of master keys, or key each lock individually, you should have a Key Control Policy. It is important to have such a Policy for two reasons:

  1. To provide reasonable personal security for employees, tenants, visitors and so forth, of your facilities
  2. To ensure the protection of personal and Member property through the control of keys to buildings, offices, shops, server rooms, resident rooms and other secure areas.

The responsibility for implementing a Key Control Policy lies with the Member.  As with all policies, they will vary depending on the Member, and the resources that they have available.  Effective policies should be practical and feasible, and ones that the staff can and will follow through on.

Some things that might want to be considered in a Key Control Policy are:

  1. When not in use, Master Keys should be kept under lock and key
  2. Master Keys should need to be signed in and out
  3. Master Keys should never leave the person who signed it/them out.
  4. Master Keys should be returned immediately after use
  5. Consider keying exterior door locks on buildings/apartments to a key that is NOT master-keyed
  6. In administration buildings and residential facilities, use a separate Master Key for each floor or wing

This is by no means an exhaustive listing of things to consider when creating a Key Control Policy, but just a starting point.  In addition, there are many, many types of locks and locking systems available, so we suggest that each member might consider consulting a locksmith to find a system that will suit their needs and budget the best, as technology can help reduce costs and time spent on re-keying.

Lost or misplaced keys and the need for re-keying are inevitable, but these can be minimized - in this one recent instance, not having all the master keys for multiple buildings on the same key ring would have helped.

Most Commercial Property Insurance policies have a sub-limit for master keys and locks that may vary between $5,000 - $25,000, and limits these types of losses.  In light of our recent experience, Jubilee is considering implementing one; however, a strong Master Key Control Policy would be the preferred means that Jubilee would like to see their Members take in order to prevent or limit the negative effects of these events to acceptable amounts.

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