It is such a delightful event to receive new business… Before you enjoy the thrill and execute the Agreement you must determine if the terms and conditions of that Contract are reasonable, fair and profitable for your business. All too often, you will rush through the contract and ignore the defense and indemnification clauses and big-time ignore the requirements for certain insurance limits and special endorsements… Stop doing that!!!
Today’s contractual requirements can be so devastating that in your eagerness to increase your business, you forgot the obligations for which you are imposing upon yourself. It is much easier after you read and understand the contractual language being presented to you by a client that it is time to negotiate these clauses. Take a peak again at the contract, it may require certain limits of liability. It may require special endorsements. All of these things add up to more expense and perhaps even a requirement that you continue those more expensive coverages and premiums for a duration of the contract plus several years thereafter.
Being smart, observant and vigilant in your understanding of these contracts will save you money, time and grief.
With good health to you…