There could be little or no control by the indemnitor of the costs involved. The typical Contractual Liability Coverage that you would rely upon may not provide insurance protection for all of the contractual liability that you have assumed. When the lawsuit is filed months or years later, it is too late to negotiate insurance coverage. Your insurance advisor needs to review these contracts before you sign the contract, in order to properly advise you of coverage applicability or coverage gaps. Often businesses are faced with the situation of accepting a contract as presented to them.
Chances are that there are other businesses willing to sign the contract as is.
Sometimes there is room to negotiate but often there is none. Either way, you should have the information necessary to make an informed business decision. Your insurance advisor should be utilized for more than a renewal premium quotation. Contract review is just one of services that you should expect from a professional insurance advisor. Eric C. Sigel, CPCU is president of Sigel Insurance Group, Schwenksville, PA and has been a licensed insurance agent and broker for over 20 years.