Error 1 is a hardware error, however it doesn't mean there is actually defective or failed hardware with your iPhone or iMac. I think I remember it from back in the day.
-Is your iMac connected to the internet via a solid internet connection? Apples Installation Authorization Server is required to verify and sign the software.
-Try using restarting everything. iMac, iPhone, etc.
-Is your iMac on the latest MacOS software? (I could be wrong but I think there was a hardware compatibility update just recently).
-Make sure your iPhone is unlocked just prior to plugging it in.
-Make sure the iPhone sees the iMac as a trusted device.
-Make sure the lightning cable is high quality and designed for data transmission.
-Don't have any other USB accessories plugged in.
-Check for security software.
-I've had issues updating when using a VPN. Verification would fail.
If all that fails just use the iOS system software updater. I know some people feel downloading and installing the entire OS is better but it's just as likely the entire IPSW will have and issue as the OTA delta will. Consider this, iOS 7 jailbreak wouldn't work with the OTA update, it required the IPSW install to bypass the security features. Granted thats cherry picked but there isn't a real difference for the end user.