Insurance Mistakes Hiring Managers Make (And How to Fix Them)

When you're juggling recruiting, onboarding, and operations, it's easy to treat insurance as a box to check—especially when hiring independent contractors. But in today's liability landscape, a small oversight in insurance compliance can cost your company thousands (or worse).

As industry veterans, we've seen the same insurance missteps pop up again and again—and they're all avoidable. Below are the most common mistakes hiring managers make, why they matter, and how to fix them using smart contract practices, the right policies, and automation tools from buildbunker.com.

✅ 1. Skipping Certificate of Insurance (COI) Verification

The Mistake:
Many hiring managers take a contractor's word for it when they say, "Yep, I have coverage."
But without a valid Certificate of Insurance, there's no proof.

Why It's Risky:
Without documented evidence, you could be on the hook if something goes wrong—especially in general liability, cyber incidents, or professional errors.

The Fix:
Always request and verify a COI before work begins. At Bunker, we automate the entire COI collection and monitoring process, making compliance painless.

🧾 2. Not Requiring Role-Specific Coverage

The Mistake:
Using a one-size-fits-all contract for every freelancer—regardless of their risk level or service.

Why It's Risky:
A marketing consultant has different exposures than a software developer or videographer. Failing to specify appropriate policies (e.g., E&O, Cyber, GL) leaves gaps.

The Fix:
Use a risk profile-based approach to identify which policies are appropriate per role. Bunker maps out common freelance roles to recommended coverage so you don't have to guess.

🏷️ 3. Forgetting to List Your Company as "Additional Insured"

The Mistake:
Contractors may have their own coverage, but that doesn't mean your company is protected under it.

Why It's Risky:
If you're not listed as an "Additional Insured," you may have no legal standing in a claim—even if the contractor was at fault.

The Fix:
Require this clause in your contract, and verify it's listed on the COI. This ensures your company is directly covered under their liability policy.

🔄 4. Not Monitoring for Policy Lapses

The Mistake:
Getting a COI at the start of a project and assuming the policy will stay active the whole time.

Why It's Risky:
Insurance policies can be canceled for non-payment or non-renewal, and you won't be notified—unless you're tracking it.

The Fix:
Use a tool like Bunker to automatically monitor policy status and receive alerts if coverage ends, ensuring you're never caught off guard.

✍️ 5. Not Embedding Insurance Terms in the Contract

The Mistake:
Relying on verbal agreements or vague contract language to enforce insurance compliance.

Why It's Risky:
If it's not written clearly in the agreement, you may not have a legal basis to require coverage—or pursue action if something goes wrong.

The Fix:
Include explicit insurance requirements in your contracts: the policies needed, limits, Additional Insured status, and COI deadlines. Bunker offers customizable contract clause templates for every situation.

🧩 What This All Comes Down To: Risk Transfer & Coverage Gaps

In the insurance world, all of these mistakes boil down to ineffective risk transfer and coverage gaps. If your contractor causes a loss and you haven't taken the right insurance precautions, the financial burden could fall on your business.

This is especially true in high-risk industries, like construction, tech, and creative services—where liability, data security, or property damage can lead to big claims.

🛡️ The Easy Fix: Let Bunker Handle It

At Bunker, we help hiring firms and platforms simplify contractor insurance with:

• 🧠 Role-based coverage recommendations

• 📄 Instant policy issuance for contractors

• 🔍 COI collection and real-time monitoring

• 🧾 Contract clause templates built for compliance

Let's make insurance compliance one less thing you need to worry about.
Explore how it works at buildbunker.com

Ready to stop making insurance mistakes?
Start your smarter compliance process today → buildbunker.com