Business owners need to request Certificates of Insurance from any business that works for them. Certificates of Insurance provide proof that one has workers compensation and liability insurance.
Why do you need to know if your vendors have coverage? Let’s say your landscaper is weedwacking and hits a stone which shoots across the parking lot and shatters a customer’s windshield. If your landscaper has liability insurance, a claim can be filed with his insurance company. If he doesn’t, that customer is going to file a liability claim against you. What if that same rock hits his employee in the eye and causes blindness? If he has workers compensation insurance, a claim will be filed under his insurance company, If not that employee could file a liability claim against you.
Make it a habit, to request proof of insurance from all new vendors. At least twice a year, request certificates of insurance from your current vendors. If your vendors can’t provide you with proof of insurance, find a vendor that can.