As an executive at your organization, it’s up to you and your compliance team to keep a careful watch on your contractors and 3rd party vendors to ensure that they remain compliant throughout the entire job.
If you were to participate in an audit of all of your contractors and vendors across all of your jobs, how confident are you that your compliance rate is at least 90%, which is the standard all organizations should strive to achieve? If you’re like most executives, you want to believe that your process is sound, but often times executives aren’t aware of all of the steps that are needed to ensure a contractor is compliant. And most executives certainly aren’t aware that even if an individual is deemed compliant when they begin a job, their status can change overnight and without warning. How are you and your team keeping up with compliance today?
Is Your Team Keeping Up With Compliance?
Despite how good a company is at keeping up with certificate of insurance compliance, the goal of any company should always be to improve their compliance rates, along with their tracking processes. Since each compliant certificate represents protection from risk, the financial security of your company depends on keeping compliance as high as possible. However, the reality is that most companies aren’t even close to ensuring a 90% compliance of their contractors and vendors. That can be a scary thought for organizations, especially those managing many contractors, vendors, and ongoing jobs.
Are Your Contractors Maintaining Coverage?
Did you know that a vendor or subcontractor could request for an important requirement to be waived and you might not even know about it? There can be a disconnect in what you think your compliance percentage is versus what it actually is. In fact, there’s a strong possibility that without the right process, items may be slipping through the cracks without your team realizing it.
Overlooking something as simple as an endorsement or a contractor dropping coverage or the amount of coverage could end up costing your company millions in insurance claims. Did you know there are 3 common reasons a contractor might not have the coverage you believe they do? Let’s take a look at how this could happen:
- If a project is ongoing, certain items are required to be included in a policy. The subcontractor or 3rd party vendor has to maintain their insurance to remain compliant. What happens if they remove a line of coverage, reduce coverage, or the policy is cancelled or expires?
- If a subcontractor or 3rd party vendor has more than one insurance agent for various types of coverage, there are many certificates and even more paperwork than normal to keep track of. It’s quite possible that one agent handles one portion of coverage and a different one manages yet another—many coverages may seem to overlap, but actually do not.
- Often times when a subcontractor first starts a job, he or she has to increase their limits to comply with the agreement. While they give documentation the first time, they may decrease their coverage over time (even against their contractual obligations) to save money.
A Seamless Process to Manage Insurance Tracking
There can be a lot of pressure for the team in charge of certificate tracking. As an executive, you can provide them with the support they need to make sure the job gets done right. With the right software and integrated systems, you can not only make sure every certificate and every contractor gets the attention needed, you can save your team hours of work while significantly reducing risk to your company in the process.
myCOI is a cloud-based software solution and exists for one reason: to help you handle the task of certificate of insurance management and to protect your company against underinsured claims, costly litigation and failed audits. The software and insurance tracking services are combined into an easy-to-use solution developed and supported by a team of insurance professionals and is built on a foundation of insurance industry logic to automate the certificates of insurance communication process and ensure you remain protected.
Ready to Learn More?
Interested in learning more or want to see myCOI in action? Request a product demo or sign up for our newsletter to stay in the know.