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Everything You Need to Know About Certificates of Insurance
While it might be tempting to rely on a habitual, manual protocol for certificates of insurance (COIs) tracking and upkeep, recent research demonstrates that antiquated systems frequently cost more than they save, and render businesses vulnerable to risks such as cyber threats, lost productivity, and obsolescence.
Facing human error, squandered time, and numerous other vulnerabilities often associated with manual documentation tracking, it is prudent businesses consider the long-term pay-offs of mitigating liabilities through modernized, real-time COI tracking software.
Sophisticated platforms enable you to easily pinpoint any COI and compliance deficiencies before they manifest as liabilities and expirations, empowering you to bring wayward vendors back into compliance with a few clicks.
Rather than risk the hefty fines, reputational damage, or legal action that often accompanies prolonged non-compliance, automated tracking curbs human errors and oversight—immediately flagging and highlighting deficiencies and expirations as they occur, for painless correction.
Although third parties are an inherent risk and necessity for businesses, those liabilities can be mitigated from the beginning of a supplier relationship with thorough risk assessments, reviews, background checks, licenses, and COIs—all of which inform about the vendor’s unique stature.
By transparently collecting and assessing relevant information before entering into a contractual bind with the supplier, your organization gains vital, full visibility into potential threats and impacts the hiring may have on your project and business.
As each vendor possesses a unique stature, it is prudent to align contractual standards with the specific risk posture of every tenant.
While it might be tempting to utilize pre-drafted contract templates, individualizing contract stipulations ultimately protects your business, enabling you to not only specify the terms of the relationship upon hiring, but instill accountability and expectations for the project’s scope.
Businesses might choose to utilize some portions of contract templates as long as they are unrelated to the supplier, such as company descriptions and other consistent variables across projects.
Once expectations and standard protocols are contractually outlined, it is essential businesses continually collect and report ongoing risk data to ensure vendor compliance and follow through.
Through real-time tracking updates and messaging via streamlined software, organizations can continually monitor timeline progress, supplier accountability, and instantly rectify any non-compliance, expirations, negligence, or other risks.
In the event of non-compliance, companies can correct documentation fairly easily, especially with certain self-service tracking software that offers instant insight and correction.
However, third-party challenges such as negligence or other liabilities require swift auditing, reporting, and potentially, legal action. Failure to address significant risks in a timely manner ultimately reflects poorly on the organization.
To avoid such liabilities, it is best practice for businesses to invest in modernized document tracking solutions that not only proactively address compliance deficiencies as they occur, but easily organize third-party information and nix communication silos.
Alongside efficient hiring from the start, establishing open communication is another guidepost for effective vendor management and cultivating good and safe supplier relationships.
According to a study by the Canadian Center for Science and Education (CCSE), “true feelings of good communication amongst participants, including managers” breeds trust, essential for any business relationship.
We recommend considering the following avenues when establishing healthy communication practices with contracted third parties:
Once you have selected the suppliers for your project needs, it is time to onboard their information into your system.
While some businesses conduct manual onboarding processes, some software enables easy onboarding through a vendor mobile app.
Regardless of whether your processes are digital or manual, it is equally necessary to ensure you collect all vital records, including individual and affiliated business information; safety, health, and financial screenings; COIs; and other related documentation.
By beginning the supplier relationship with thorough documentation, you facilitate convenient recall and transparency throughout the project timeline.
During day-to-day project processes, it is often convenient for organizations and suppliers to ask questions and clarify information via a streamlined messaging portal, rather than sift through emails or other lengthier correspondence to address the minutiae of business operations.
By investing in messaging-enabled software, you not only ensure your vendor records, COIs, and other necessary information is in a centralized database, but that you can clarify pertinent details about those records or other concerns in a timely manner.
In regular communication with third parties, it is also best practice for businesses to keep detailed accounts of information, affording full visibility over third-party records, activity, accounts payable, stakeholder assessments, and more—all within a streamlined vendor list.
These databases are the most current representation of your third-party suppliers, shedding light on active tenants, relevant documentation, accounts payable balances, and stakeholder assessments.
By continuously updating this information, you can be empowered to repeatedly select ideal candidates and build safer, lasting relationships.
Along with prioritizing the above, it is also pertinent that businesses implement risk management in these avenues of communication, ensuring to set clear expectations from the beginning of the relationship, maintaining contact about project progress, and more.
Of course, modernizing your vendor management system aids significantly in both communication and risk management, as well as in streamlining nearly all business processes—from hiring and onboarding to COI tracking and document reference.
While a modernized vendor management software typically requires more upfront investment, it will likely save your business money in the long term.
The vendor management software landscape offers myriad benefits, and we recommend implementing the right solution for you to streamline vendor management in the following areas:
Modernized software facilitates a seamless hiring process, from job posting to onboarding.
Whereas manual processes might rely on traditional servers, job sites, and so on, automated request for proposal (RFP) capabilities add a layer of unprecedented efficiency and employee verification to the hiring process. By broadcasting RFPs to vetted software networks, businesses can effortlessly find and procure new vendors, make selections from a pool of pre-qualified applicants, and conveniently onboard new hires through a vendor mobile app.
While assessing applicants, it is also best practice for companies to utilize vendor screenings for full visibility into third-party liabilities and assets. U.S. Office of Foreign Assets Control (OFAC) debarment screening; environment, health and safety (EHS) screening; and financial and legal screenings significantly mitigate risks of undesirable litigation history, claims, bankruptcy filings, and more—empowering your business to build healthier, informed supplier relationships.
Rather than relying on manual COI filing, tracking, and documentation management, modernized systems negate human error potential with instantaneous flagging and notification about compliance deficiencies, expirations, and other liabilities for an easy return to compliance.
Whether accessing vendor records or correcting documentation expiration, these sophisticated platforms serve as unparalleled, streamlined hubs for communication, COI updates, tracking, and so much more—protecting valuable time, money, and peace of mind through automation.
From vendor portals to document databases, modernized software not only provides automatic tracking and upkeep, but serves as a vast repository for storage and document reference, negating the need for mountains of spreadsheets and manual filing.
Cutting-edge software grants instant access and recall for vital information, all safely protected within a secure server.
In maintaining safe and strong vendor connections, it is crucial organizations pay suppliers equitably and explore possibilities for API (application programming interface) integrations—connections between two or more applications that facilitate data sharing.
This integration enhances the streamlined capabilities of modern tracking solutions by seamlessly linking information between application servers.
The sheer innovation of these cutting-edge software systems enables the integration of risk management and communication best practices, ultimately saving your business money, protecting from liabilities and oversight, and streamlining vendor management.
By investing in these crucial third-party management guideposts, you can ensure your organization cultivates safe vendor relationships, fulfills project expectations, and runs optimally.
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Beyond just tracking certificates, BCS delves into the real details of insurance coverage to unmask exclusions that could otherwise put your organization at risk.
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Most solutions try to put a cap on this, but our compliance analysts handle all the inbound/outbound vendor support necessary to get them compliant.
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Our advanced analytics tools provide the insight you need to make the best risk management decisions in real time.