It’s no secret that tracking certificates of insurance (COIs) manually is a tiresome process. Due to this, many corporate and public entities tend to skip the procedure entirely and trust their contractor has the proper coverage. While it may seem like the easier route, in the long run, this could be costly for your organization. In fact, according to a study done by Insure, 75% of U.S. businesses are underinsured, and 40% of small business owners have no insurance at all. This means it’s likely you could be working with a third party that does not have the required coverage.
Even though we would like the monitoring of COIs to end after receiving the certificate, the unfortunate truth is that’s only half of the job. After you obtain the COI, premiums could be late or a policy could have an unexpected change months before a term ends. Between fraudulent certificates, policy cancellations, and reductions of coverage, there is plenty you need to monitor consistently to make sure your workforce’s coverage is current and compliant.
Transfer The Risk
More often than not, a contractor doesn’t have the needed coverage required. If this is the case when an accident happens on-site, your company will be responsible for the loss unless you can transfer the risk. The payout could amount to thousands of dollars and insurance premiums could be raised.
Ensuring your certificates of insurance are up-to-date will guarantee a contractor is covered and your exposure is minimal.
Collecting Certificates is Not Enough
Simply collecting compliant certificates and storing them in an old filing cabinet is not enough. Work still needs to be done to make sure that your certificates remain compliant. For example, if there isn’t notice of coverage cancellation before a term expires how can you protect your organization from a third-party risk?
Gaps in coverage could be detrimental to your organization, and can even lead to legal repercussions if they aren’t detected and managed adequately. Having a COI tracking system in place can automate the process to save your team hours of manual entry and verification.
COI Tracking Benefits
One of the biggest benefits of all is your team won’t be burdened by the task of searching for gaps in coverage and can spend more time on other matters. Using software to track COIs not only protects your organization from an uninsured or underinsured third-party loss but is also proven to lower operating costs for companies of all sizes.
CTrax extracts, stores, and updates COIs with over 99% accuracy and minimal input. Users of the system are able to find any certificate uploaded quickly with a simple search and can access them at any time. This also protects the documents in the event of an emergency, such as a fire or flood, since they’re being tracked in the cloud.