Don’t Get Burned: Why Requiring a COI Saves You Headaches (and Money)
As a business owner, I’ve learned a few lessons the hard way. One of them? Always require a Certificate of Insurance (COI) from potential clients. Believe me, it might seem like an annoying formality, but trust me, it can save you a world of trouble.
Just recently, I lost out on a seemingly great project – a $15,000 job in Las Vegas. The client balked at the idea of providing a COI. Let me just say it was a blessing in disguise!
Here’s why a COI is your friend, even if it means saying no to some clients:
- Red Flag Alert: A client who pushes back on a standard insurance request might be a red flag. They could be financially unstable or have a riskier-than-average project in mind. A COI helps you avoid potentially risky situations.
- Attracting the Right Clients: Look, some clients might be scared off by the need for a COI and a custom proposal. But that’s okay! These processes weed out clients who don’t value professionalism or risk management. In the long run, you’ll attract clients who appreciate a secure working environment, which is good for everyone.
- No Collection Problems: By the same token, in general you can say that clients who don’t have a problem with providing insurance are the ones you don’t have to worry about paying!
Think of a COI as a safety net. It protects both you and your client. Sure, it might take a little extra time upfront, but the peace of mind and potential risk avoidance are well worth it. So next time you’re considering a project, don’t be afraid to ask for that COI. It could be the difference between a smooth project and a financial nightmare.
