Contract Clause Library
Insurance clause
Requires one or both parties to carry specific types and minimum amounts of insurance coverage during the engagement.
Larger clients, especially enterprise ones, often require a vendor to carry professional liability (errors & omissions) insurance, general liability, and sometimes cyber liability coverage, with specified minimum coverage amounts, as a condition of the contract. This clause states those requirements and sometimes requires proof of coverage (a certificate of insurance) before work begins.
Sample wording
Sample language (illustrative, not legal advice)
Vendor will maintain, at its own expense, Commercial General Liability insurance with limits of no less than $1,000,000 per occurrence and Professional Liability (Errors & Omissions) insurance with limits of no less than $1,000,000 per claim, and will provide a certificate of insurance upon Client's request.
Red flags
- Coverage minimums well above what's typical for the size of the engagement, which can meaningfully raise the vendor's insurance cost
- No mention of who's named as an additional insured, if that's expected
- A certificate-of-insurance requirement with no defined timeline for providing it before work starts
How MarginFlow reads it
MarginFlow extracts the required coverage types and minimum amounts so they're checkable against the vendor's actual policy at a glance, without needing to dig through a separate insurance binder to confirm the contract's requirements are being met.