Contractors can’t ignore the importance of financial protection, no matter what sector they work in. You will also be protected from lawsuits and damages if you have a contractor’s insurance policy.
Here’s how it works
The purpose of contractor insurance is to provide financial protection to your business if it is involved in an accident or a peril that causes financial loss. An insurance policy is an agreement between a firm/individual and an insurer. A specific premium amount will be charged as the price of insurance coverage, which you will receive from the insurer if damages occur. In essence, you’ll be able to choose what kinds of coverage you want to protect, which will depend on your preferences, budget, and needs. Depending on the terms outlined by the signed contract, financial coverage will be provided.
Contractors are sometimes required to show proof of insurance and enlist the client as additional insured on their commercial general liability policies. It is common for a certificate of insurance to accompany an endorsement as evidence of coverage.
An additional insured endorsement can be obtained by contractors
Aside from the requirements, restrictions and complexities that come with every insurance policy, getting an additional endorsement also has its own peculiarities.
As a first step, you need to define who you want to include in the endorsements. You can add an additional insured either as an individual or as an organization. Depending on the purpose of the additional endorsement, the wording may differ. It can be obtained for ongoing or completed operations.
ONGOING OPERATIONS
COMPLETED OPERATIONS
BLANKET ADDITIONAL INSURED ENDORSEMENT
A blanket additional insured endorsement, also called an automatic endorsement, allows for a contract to automatically include those entities and individuals as AIs.