Performance Agreement with Sub-Contractors

Effective risk management techniques can reduce your exposure to the financial risk from lawsuits whenever a transaction creates an exposure to liability you expect another organization to bear.

One significant method of risk management is to contractually transfer risk to the responsible party. In your business, the most common situation where this technique would be appropriate is in your relationship with independent contractors.

Click here for an Indemnification Agreement you can use, which in short states that the contractor is solely responsible for their work, will hold you harmless and provide that you are an additional insured. This will most likely provide an additional amount of insurance protection under the contractor’s policy.

Example: LAWSUIT-------CONTRACTOR----Then----RETAILER

You as the retailer would be afforded coverage as additional insured under the Contractor’s insurance and after those limits had been exhausted your own policy would then provide coverage. You have now been able to financially transfer the risk to the contractor and will be afforded their limits of protection first.

After completion of the Indemnification Agreement you should receive the following from the Contractor:

CERTIFICATE OF INSURANCE HAVING THE FOLLOWING COVERAGE:
· Minimum General Liability limit of $1,000,000
· Your Business Named as Additional Insured
· Worker’s Compensation

As always, we encourage you to contact our office, if we can be of further assistance.