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The Difference In Fidelity Insurance And Commercial Liability Insurance

Many people are under the impression that all business insurances are one and the same. This is a major misconception, because there are many types business insurance plans that offer different coverage. Many Canadian business owners prefer a customized plan that is specifically designed for their business to a general insurance policy. However, the option is yours to make, so be sure to make your decision with an open mind and only when you are familiar with your options. Below, you will discover the differences in fidelity insurance and commercial liability insurance plans.

Commercial Liability Insurance

Commercial general liability insurance for business covers all claims made against the business by third parties. This basically means if a client who falls and is injured inside your business establishment or outside on the property files a claim against your business, commercial liability insurance will cover the individual’s health care bills and other expenses. Which in turn will protect your business from financial loss.

Commercial liability insurance Ontario

Commercial liability insurance will also cover injuries from company products. While this type of business insurance appears a little limited, it will play a major role in protecting your company from financial loss.

What Is Fidelity Insurance?

Unfortunately, Fraud in the country is Canada is more common than you might imagine. It was estimated that nearly half of retail and insurance businesses experience some type of fraud yearly. A recent study concluded that 57 percent of retailers experienced fraud, while 45 percent of insurance establishments did so. The good news is that there is insurance that can protect you from fraud. In the country of Canada, it is very wise to invest in fidelity insurance for business.

fidelity insurance

This is where fidelity insurance enters the picture. Fidelity insurance is a specific type of insurance product that is designed to protect companies against losses that are caused by fraudulent acts. It may also be referred to as crime insurance. Fidelity is far different from business liability insurance. Fidelity will provide your business from losses that have been caused by dishonest acts carried out by your employees. This insurance can also protect from computer systems fraud and acts carried out by outside parties.

Both Are Pertinent

When it comes down to it, both insurance products are absolutely pertinent for modern businesses. The mass majority of business insurance Ontario providers will offer a combination of both. Trisura and Intact usually do. This is definitely not a coincidence. There is a good chance that your company is going to experience serious problems in the future and your employees may be responsible. Analysis suggests that 96% of all companies will encounter some type of employee fraud or theft at some point.

Simultaneously, there is always a chance that your company could become a victim of a frivolous lawsuit. Or you may end up making a mistake and end up getting sued for that mistake. This is why all Canadian companies should consider getting covered by both insurance products. With both insurance policies, you’ll be able to protect your business from anything and everything that comes your way! There is a good chance that you’ll be able to get both from your current insurance provider.

How To Choose E&O Insurance For Your Business

Step by step

The mass majority of long-term Ontario businesses have and maintain a valid E&O insurance policy. This insurance might seem like an unnecessity, but this couldn’t be further from the truth. Even if the insurance is not required for your specific profession, you never know when a client will become disgruntled. Therefore, you should always maintain E&O insurance. The insurance will protect your company and allow you to remain in business for the long run. Of course, it is important to remember that not all businesses need the same amount of coverage. Below, you will learn how to get E&O insurance for your business.

errors omissions insurance for business

How It Works

Before jumping in blindly, it is absolutely essential to learn more about this form of insurance. The truth of the matter is that errors and omissions insurance is designed to protect your company. While it may provide a little protection and peace of mind to the client, it primarily provides you with protection from lawsuits stemming from neglect. And of course, the insurance also protects you from unfounded lawsuits. After a lawsuit has been filed against your company, the insurance will enter the picture and pay for the legal costs. If you are required to pay a settlement to the client, the insurance will also help.

Therefore, almost all businesses need E&O insurance Ontario if they are going to be providing service to the public in exchange for a profit or non-profit. However, you need to figure out precisely how much you need. Continue below to learn how to do just that.

Evaluating Your Risks

First and foremost, you should understand that each company will face a certain degree of risk. Your risk will be substantially different from that of another business in your area. Therefore, you may not need the same amount of errors and omissions insurance as other businesses in Ontario. Nonetheless, it is essential to obtain enough coverage to ensure your company is protected to the maximum. If there is a possibility that your company could lose a million in settlement costs, it is essential to make sure your insurance policy will cover that amount.

Determine your precise risks and make sure your insurance coverage is capable of accommodating those risks. If you fail to obtain enough coverage, you may end up being forced to pay out of pocket.

risk of doing business

Understand That E&O Isn’t Comprehensive

While E&O insurance can be enormously beneficial, you should realize that it will not protect you from all potential problems. You need to understand that E&O isn’t a comprehensive solution. Instead, it only protects your business from negligence and failing to perform up to standard. Therefore, you should not dump your entire bank account into this type of insurance coverage. It does not protect the company from malicious or dishonest behavior. Also, the insurance will not protect you from claims submitted by your business associates.

Therefore, you need to find a balance and dedicate the right amount to E&O insurance and other types of policies. This will ensure your company is protected from all different types of claims and disputes.

Determining Your Coverage Needs

While you’re at it, you need to determine precisely how much insurance coverage you need. Depending on your line of work, you may be required to obtain a minimum amount in Ontario. There are specific laws that require certain businesses to maintain a specific amount of E&O insurance in this province. Therefore, you should check the local laws first. Then, you will need to consider the potential costs associated with a lawsuit and a settlement.

Make sure that you obtain enough coverage to pay for these costs. Again, if you fail to get enough coverage, you may end up being forced to pay out of pocket for legal fees or to reimburse the client.

Always Read The Fine Print

Before signing on the dotted line, it is pertinent to carefully read the fine print. The mass majority of policies will cover each and every legal cost, but this is not always the case. Some insurance providers will actually exclude the defense cost and this could take a big chunk out of your company’s bank account in the future. Therefore, you need to read the fine print and make sure you’re getting comprehensive coverage. To protect your business to the fullest, you need to protected for settlements, judgments and defense costs.

This will help to decrease the likelihood that you’ll be forced to pay out of pocket for anything, regardless of the outcome of the trial.

professionals insurance policy

Act Quickly

While the above steps might seem like a hassle and potentially time consuming, you should make your way through them very quickly and carefully. Serving clients without E&O insurance is incredibly risky! Each time you make a decision for your client or take on a new client, you are putting yourself in a risky situation. Therefore, you should not delay! Even if the laws in Ontario do not require you to get the insurance, you should do so immediately. It is generally best to get covered before you begin offering your services.

Contractor Liability Insurance Should Be In Place Before Getting Help

If you’re going to get help with a project, make sure you ask if someone has contractor liability insurance before they work with you. That way, you’re not stuck with someone getting hurt and costing you money. Here’s how to hire the right person with the right kind of coverage for any job.

One way to know if you’re working with someone with coverage is to just ask. Then you can ask them what kind they have because that will usually be enough to know if they are telling you the truth. If someone just tells you they are covered but they don’t know what kind of insurance they have, chances are it’s not in place or it’s old and expired. To find out if it’s true either way, try to ask for proof of it.

Contractors should only be able to work on jobs if you can prove they have a good history. This shouldn’t be that difficult, because if they are not able to show you that they have reviews online or are on a website for people that confirm they have a good background, you could be working with anyone. In other words, you want to find out if they’re really who they say they are. Otherwise, it could be hard to get good work done and if there are any mistakes you may not have any recourse if they are not able to be reached later.

Insurance is something that can be tough to get a hold of, but most people that have it should be sure whether or not it’s active. Sometimes when a contractor gets insurance, it takes a while for their coverage to start out. You’re going to find there to be quite a few options out there and you can just look up the various types of insurance that contractors can get through a search engine. Either way, you’re going to have to be intelligent about this or you may end up working with someone that just made up an insurance company.

After working with someone it’s best to deal with them on a regular basis if they are good. If not, make sure you leave a bad review somewhere so that others know what to expect. However, before you do this you’re going to need to make very sure that you contact them and see if they can make things right. Tell them that you’re not happy with how the work turned out and see what you can do before you leave a review on how you’re not that happy with it if they don’t do something different for you to make it right.

Contractor liability insurance has to be in place so you can be safe when you work with anyone. They need to have it so you’re not going to have to deal with being sued if they get hurt. Plus, it helps to get things replaced that may have been damaged during a job in some cases.

Learning About Surety Bonds – Differences Between Contract And Commercial Bonds

The surety bond market is incredibly diverse and the sheer number of bonds can be downright daunting. This can make the concept of surety bonds very frightening to many individuals. However, once you really begin delving into the bonds, you’ll find that they’re not all that complicated. In fact, there are two common types of surety bonds and both are commonly utilized throughout the country of Canada. Within this guide, you will learn about the contract surety bonds and the commercial surety bonds used in Canada.

Similarities

Although the two groups are undoubtedly different to some degree, they also share some similarities. The most notable is the fact that all surety bonds involve three parties. If you’re somewhat familiar with surety, you’ll know all about the surety, principal and obligee. Regardless of the specific type of bond that you’re dealing with, these three parties will be present and they’ll always place the same role. At the same time, the surety bond will always protect one individual or group of individuals.

Contract SuretyCommercial and Contract Surety Bonding for Companies

There are numerous construction companies in Canada and each of these will be required to obtain surety bonds from a surety bonding company like ConstructionBond at some point or another as they decide to bid on jobs. This is where the contract surety enters the picture. In this type of scenario, the contractor is responsible for obtaining the surety almost always. In the event that the contractor is unable to complete the job or cannot do so within a reasonable time period, the obligee will be protected. They’ll be able to file a claim against the bond and seek reimbursement for their losses.

Commercial Bonds

When someone talks about commercial bonds they are referring to all bonds other than construction contract bonds. A commercial bond is obtained by Canadian businesses like Chubb to assure the government and public that the business will abide by the standards that are required by law. Commercial bonds can be broken down into several different categories such as license and permit bonds, tax preparer bonds, notary bonds, court/judicial bonds, and processor bonds.

Wrapping It Up

The truth of the matter is that contract surety and commercial surety are nearly identical. However, the biggest differences between the pair are why, where and how they’re used.

Is The Principal Protected By A Surety Bond

Protection when it comes to Surety Bonding

As a contractor, professional or business owner, you’ll likely come across a situation, which requires you to obtain a surety bond. In this type of situations, you’ll want to know precisely how the surety bond behaves. Does the bond provide you with protection or is it only designed to deliver protection to other parties? Below, you’ll figure out.

Surety bonding PROtection

Protection?

Many people believe that the surety bond protects the principal. This simply is not the case. Surety isn’t insurance and it doesn’t provide the principal with any protection whatsoever. However, this doesn’t mean that you should scoff at the idea of surety. The truth of the matter is that surety bonds can be very beneficial for all parties involved, including the principal! Of course, there are some specific types of bonds, which can provide the principal with a little bit of reassurance, when doing business with others.

Subcontractor Bond

Large development projects require the involvement of general contractors and subcontractors who are required to be licensed in Canada. Of course, the general contractor is the primary responsible member of the team. To ensure themselves that subcontractors and suppliers fulfill their end of the bargain, they require them to post a subcontractor surety bond. If at any time, the subcontractor falters on the terms of the contract, the general contractor can file a claim against the subcontractor’s surety bond. This is basically the only way that general contractors will be protected under a surety bond.

subcontractor bond

Who Is Protected?

Truthfully, there is an array of different people and groups, who may be protected by the surety. The specifics will vary depending on the bond in question. In many situations, the bond will protect the public. This is the case, when dealing with license bonds. On the flip side, construction bonds are primarily put in place to protect a property owner or project developer. Unfortunately, the principal usually doesn’t receive any protection.

Overall

At the end of the day, the majority of bonds will not protect the principal. However, it can offer these individuals with an array of other benefits. With this in mind, you should remember that the bonds are not only a requirement, but also they’re beneficial and cannot be neglected.