Alarm-company gotchas

Last reviewed: June 2011

Alarms, especially noisy ones, can provide an extra layer of security. Almost 80 percent of homeowners with alarms rated those systems effective at protecting their homes in a recent, nationally representative survey by the Consumer Reports National Research Center. But before you get an alarm or switch monitoring companies, check whether your area requires a permit, and be aware of the following contract clauses:

Early-termination charges

These can leave you liable for up to 80 percent of the costs of the contract's term, even if you move.


A contract we saw warns that promises made by sales staff or in ads are not binding if they're not in the contract.

Limited liability

If you suffer a break-in, even due to the alarm company's negligence or failure of the equipment or service, the company isn't responsible and won't reimburse beyond a specific amount, $300 to $1,000 on the contracts we reviewed. You might also forfeit the right to sue the company for additional money.