In days gone by, nothing more than a handshake was needed to seal a bargain between a business owner and a client. These days, however, so-called gentleman’s agreements are not sufficient protection either for the entrepreneur or the person receiving the service. You now need not only a contract but business insurance that will protect that agreement.
Why Your Client Wants Contract Insurance
When you provide a product or service, it is reasonable to expect that your customer will pay the agreed-upon price. By the same token, your client has every right to presume that you will complete the services or furnish the products you promised. Contract insurance protects your customer should your enterprise be financially unable to live up to your end of the bargain.
Why You Should Also Want Contract Insurance
As an entrepreneur, you pride yourself on offering quality products and services at a competitive price. Giving your clients excellent customer care is also probably a high priority for you. Even so, whether something goes wrong and you make a mistake or provide a shoddy product or whether you have done nothing wrong, there may come a time when one of your customers is displeased – so much so that a lawsuit is brought against you. If you have contract insurance in place, you can be protected against claims for negligence, failing to perform a service and other conditions.
Types of Insurance and How They Can Protect You
- General liability insurance is a blanket form of coverage that protects you from a variety of claims. These include property damage, injury to a third party and any medical claims that may be associated with the accident. Most business contracts will require that you have at least $1,000,000 in general liability coverage.
- A business owner’s policy, sometimes known as a BOP, is frequently purchased by entrepreneurs because it combines the two most necessary forms of coverage: liability and property insurance. Obtain this insurance and your storefront will be protected against property damage and losses due to business interruption caused by covered factors such as damaging storms and major theft. Office and computer equipment as well as tools will also usually fall under this type of policy.
Think of your contract insurance as a stable foundation upon which your operations can be sustained and protected. While it represents an investment in time and premiums, it may pay for itself many times over in the event of an accident, natural disaster or lawsuit. Contact your insurance agent today to find competitive business insurance rates that will provide comprehensive policies to protect you and your clients, and your operations are sure to run more smoothly.