What follows is a dangerous misconception; one I hope most of you don'thave. Alarm contracts are vital for your business- protecting it andbuilding equity for the business. Contracts create the recurring revenuethat you depend upon to fund your operation, and use when you apply amultiple to fix the value of your business when you sell.While it is true that an insurance company would be wise to insist onproper alarm contracts before agreeing to underwrite your company, that isonly one reason you should be using proper contracts; there are many more.
*********************************
Ken,
Isn't the whole basis of contracts to provide INSURANCE PROTECTION?If your client is really concerned that he might have to sue you to collectdamages, wouldn't he rather be covered under the umbrella of your liabilitypolicy? Without a contract he would fight an UPHILL BATTLE to collect fromthe insurance company.If he wants to sue my company and me personally good luck.Don't forget to pay the lights and heat bills this month and treat theemployees good. YOU NOW OWN AN ALARM COMPANY.I'M OUTTAHERE.....Joel ***************************
Answer
Why do you think you and your company are immune from suit? And do youthink for one second that you don't have assets? You can be exposed topersonal liability in excess of any insurance you carry, so even aninsurance policy may not be enough to protect you. If that kind of lawsuitcomes your way you are going to be praying that you have the right kind ofprotection, and your contract is your first and most important layer ofprotection. You really can't depend on the insurance carrier to review yourcontract. What may be acceptable to it may not be everything that you couldhave hoped for if you are personally exposed.
*******************************