Yes, You need a contract
Having a standard contract written by a legal expert in your industry is the closest thing to a “get out of jail free” card you can have. It improves retention and builds in value… In short, just do it.
A properly executed contract with a Liquidated Damages Clause can be the difference between a court telling you to write a $250 check when your customer’s premises is burglarized, vs the court holding you responsible for the value of everything stolen.
But *every time*? That is, is there a consequence from the insurance industry if you don’t get your contract executed on each and every job?
It depends. Many alarm insurance companies have an endorsement in their policy that restricts coverage to jobs where you have an executed contract in place with your Liquidated Damages clause included. This means: no contract, no coverage. Not a good limitation, but maybe livable If you only do work when you get a signed contract every single time.
So what if it’s a job where you don’t control that? Say you’re doing pre-wire work for a general contractor and there’s no end user (yet) to sign your contract? Or what if you’re picking up an account from a selling or retiring dealer and it’s out of contract?
You get the idea: there’re lots of possibilities. But make no mistake: if you do the work without the benefit of your contract, you are exposed. So if that’s ever you, make sure you don’t have an insurance policy that does’t cover you if you are.
Every dealer has to make “business decisions”. Some are safe, others are risky. Both can be fine, If you know what you’re up against. If you ever need a review of how your liability protection matches up with the jobs you’re on currently, give us a call.