Insurance and bonding verification is the step that most facility managers know they should do and fewer actually complete before a new cleaning contractor starts. This article explains why the verification matters, what to ask for, and what the documents tell you.
General Liability Insurance
General liability insurance covers property damage and bodily injury claims arising from the contractor’s operations in your building. If a cleaning crew member drops a piece of equipment that damages a tenant’s workstation, general liability insurance is what pays the claim. If a wet floor causes a visitor to slip, general liability is the applicable coverage.
The coverage amount matters. A policy with a $300,000 per-occurrence limit is not adequate for a commercial building where a single incident could cost more. Request a certificate of insurance and look at the per-occurrence and aggregate limits before you sign any agreement.
Also check whether your lease or property management agreement requires your cleaning contractor to carry a specific coverage amount or to name you as an additional insured on their policy. These requirements are common in commercial leases, and a contractor who cannot provide them may expose you to a lease compliance issue.
Workers’ Compensation
Workers’ compensation coverage is required for cleaning employees in Minnesota. A cleaning contractor operating without workers’ comp either has no employees (a misclassification risk) or is operating out of compliance. If an uninsured cleaning worker is injured in your facility, you may have exposure depending on the circumstances. Request a workers’ compensation certificate alongside the general liability certificate.
Employee Bonding
Employee dishonesty bonding provides coverage in the event of theft by a crew member. Cleaning crews have after-hours access to facilities that most employees do not. Bonding does not prevent theft, but it provides a recovery mechanism and signals that the contractor has undergone the underwriting review required to obtain the bond.
When you verify bonding, confirm that the bond covers the employees who will actually be in your building, not just a general business bond that may not apply to employee acts.
How to Request the Documents
Before a new contractor starts, request a certificate of insurance listing the contractor as the insured and your company as the certificate holder. If your lease requires additional insured status, the certificate should reflect that. Request the same for workers’ compensation. For bonding, ask the contractor to confirm the bond amount and provide the bonding company name and policy number.
A contractor who delays or resists producing these documents is a contractor to be cautious about. Insurance and bonding certificates take minutes to produce from a licensed contractor with current coverage. See our insured and bonded page for our coverage description and how to request a certificate.