Uninsured and negligent vendors and subcontractors can injure others or property when they are on a job. They carry risks that might expose their companies to costly claims and lawsuits. Accidents can happen amid the strictest of safety protocols. Companies can mitigate this risk by requiring their third parties to have sufficient insurance coverage.
How can vendors and subcontractors prove they are insured? What is a COI and why is getting one from a vendor difficult? What is certificate of insurance tracking?
Answering these questions is crucial for your company’s health.
Certificates of Insurance Protect Your Business
Your company needs as much protection as it can get to survive the stresses of liability risk. Insurance is a powerful defense. Making your vendors and subcontractors have their own insurance is one more layer between survival and bankruptcy. A certificate of liability insurance is another critical tool your company can use to shield itself.
What is a certificate of liability insurance?
Simply put, a certificate of insurance (COI) is proof of coverage. Companies can present COIs in the event the vendors or subcontractors they hired cause personal and property damage. This action not only proves coverage but can expedite the claims process.
Just possessing COIs is not enough. Companies should use certificate of insurance tracking to strengthen their protection.
What is certificate of insurance tracking?
COI tracking is the lengthy process that stores, verifies, and monitors COIs to confirm each third-party’s coverage is active and up-to-date. Lapsed coverage is useless and makes companies vulnerable to claims and litigation. COI tracking makes sure companies’ insurance requirements are consistently fulfilled.
Getting Certificates from Vendors Can Be Difficult
What is a certificate of insurance for vendors?
It’s no different from one for subcontractors. It proves the third party is adequately covered.
More importantly, you should know how to get a certificate of liability insurance from your third parties.
Getting COIs from vendors can be difficult if you use spreadsheets or free tracking software. Spreadsheets can keep your COIs organized to a point but they can’t contact vendors for you. Free tracking software probably just monitors your COIs and barely. Can you trust those applications to request COIs from your vendors? What if they fail and your vendors’ coverage expires? What if no one catches this blunder until it’s too late?
You could use a sample letter requesting certificate of insurance from vendors to draft an official document but you might have to use your spreadsheet to determine whose COI is about to expire. Can you trust the spreadsheet data? People make mistakes. Typos happen.
An easy-to-use solution like myCOI can remove the difficulties that spreadsheets and free software present. The platform can automate communications between you and your third parties to ensure your company remains protected. myCOI can teach you how to request a certificate of insurance from a vendor in a matter of seconds.
Even COIs in Hand Can be Difficult to Read
COI insurance tracking can be performed manually via spreadsheets and free software. You can personally verify each COI. A do-it-yourself attitude could cost you and your company exorbitant amounts of time.
Understanding your company’s coverage responsibilities necessitates specialized knowledge. Since there are differences in certificate of insurance requirements by state, you have to keep up with current regulations. You also have to know what every piece of information on a certificate of liability insurance form means. You must verify all of this information and not miss one thing.
You can successfully manually track your COIs. You can follow the best practices to get the job done right. You can also fall behind if your COI volume increases. You can fall behind if you miss the changes to insurance regulations because you’re too busy playing phone and email tag with vendors. COIs can be difficult to read properly if you do not devote time to them. In some instances, reading them proves impossible. Your company can not afford this detriment.
A Critical Complication Requires a Solution
A certificate of insurance for contractors and vendors is a critical component that protects your company. They are complicated to handle but not unmanageable. Using a supported platform to collect and confirm COIs increases compliance and decreases risk.
Managing certificates of insurance issues and answers is a balancing act. You can resolve compliance issues. You just need the time to do it. However, you’re busy with the rest of your duties. Once the balance tips the wrong way, one task can cause a critical complication.
A certificate of insurance for business can be difficult to acquire and authenticate. Just because you know how to get a certificate of insurance doesn’t mean you have the time to process it.
myCOI automates renewal requests, saving you from playing phone tag with third parties. COI tracking isn’t necessarily a game. If you think of the complex process as one, then myCOI is the boost that can get you over the finish line.
Backed by insurance experts, myCOI can make sure your COIs adhere to regulations. You don’t have to constantly stay current with the news. You can realign your focus on the other things you have to do. You don’t have to short-change COIs any longer.