​​​​​​​​​​​​​​​​​ THE BOURNE FIRM

​​​​​​​​​​​​​​Experienced on-demand general counsel for small to mid-sized companies not yet ready for full-time general counsel. 

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Contact  : jon@thebournefirm.com  (  303.765.2436
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Are you covered? 
Indemnification provisions in contracts are a key component of risk management. They may be meaningless, however, without adequate insurance.  Here are a few quick tips to help cover you: 
  • Understand the difference. An indemnification provision requires the other party to a contract to pay you in certain circumstances (for example, as a result of the of recklessness of the other party). An insurance provision, if properly structured, requires payment to you under the other party's insurance policy as a result of the other party's conduct.

  • Be additional insured. If you are not an additional insured, then your premiums may increase and you may not have the right to seek payment from the insurance company under the other party's insurance policy. 

  • Verify financial strength. If you are named as additional insured, but the insurance company is not of sufficient financial strength, then you similarly may not be paid. Verify that the provision for insurance includes a mandatory minimum rating for the insurance company's financial strength.

  • Understand insurance scope. If your intent is that insurance pay contractual obligations in addition to indemnification obligations, be certain that the scope of the insurance provision is not limited in this regard. A limit on insurance to indemnification obligations, in some states, results in a legal prohibition on payment to you for your simple negligence.

  • Notice of cancellation or modification. Require at least 30 days prior written notice of cancellation or material alteration of any required insurance. Without this notice, initial protection may disappear, and you may not be covered.
INSURANCE.
THE BOURNE BRIEFS.
THE BOURNE FIRM.