Insurance Business Contracts

Any business with employees needs insurance. However, some business owners do not realize the importance of site security in the search for the right insurance policy. Insurers require secure work environments, which means that all employees have access to the job site through a secured doorway. It is also a requirement that employees sign a company-wide non-compete agreement, which restricts other employment opportunities to the business. Site security must be considered in any competitive insurance market.

Every insurance company employs risk managers to determine the risks associated with each area of an organization. The risk manager is responsible for determining which areas and types of jobs pose the greatest risk to the company. This information is then presented to the entire operations staff to ensure that these jobs are eliminated from the company’s insurance policies. Without employees who know how to protect the assets located on the job sites, an insurance policy will be overly expensive for the insurer. In this sense, it is important to hire qualified individuals who know how to manage risk.

Site security is an inherent part of insurance business contracts. Therefore, companies should be very specific about what they want in terms of coverage and deductibles for their insurance policies. In fact, insurance companies have been known to include specific site security stipulations in the purchase of insurance business contracts. If these stipulations are not included in the initial contract, the buyer can always purchase those components separately as needed.

For example, an insurance company may require its employees to report crimes within a one-mile radius of the company headquarters. Other insurance companies may have their employees go to their place of business in a designated vehicle. Regardless of what vehicles employees use, vehicles must be accessible to them at all times. Allowing a potential crime to be committed within a one-mile radius of the company headquarters is not a viable security practice.

The same is true with employee conduct issues. An insurance company cannot simply write off any legal responsibility to an employee in the event that the employee commits a crime. Such a move would be considered illegal discrimination and could result in tremendous losses for the company. For these reasons, insurance companies have been very specific about what types of employee conduct policies they will not cover and will expel employees from their insurance plans for violating such policies.

It is also very important for insurance business contracts to specify which liability the insurer is protecting. Without this element, a company could be sued for medical bills, property damage costs, etc. If a company is sued, it must be very clear how much the insurance company is willing to pay out in settlement funds. If a lawsuit is initiated by someone who is injured on the property of the company (whether this is a work site, a customer service center, or another location), the amount of liability the insurance business contracts will protect the insurer is usually listed there. A good example of such language is found in Article 5 of the Home Insurance Providers Code of Virginia, which provides that a company “may protect its insured’s interest or rights by including a indemnity for personal or bodily harm or death sustained or attempted against the insured.”

The language in insurance business section contracts is very broad. There are a wide variety of possible claims an insurer can make under a policy. It is important for companies to consult an insurance attorney as to what types of claims will be addressed in their contracts. Additionally, any potential claims should be fully explained to the potential policyholder to ensure full compliance with the applicable laws.

The purpose of insurance business contracts is to protect an insurer’s interests as best as possible. These contracts often contain sections that address potential conflicts between the company and its customers. They also detail the various layers of insurance protection each company will have available to it under the policy.