Anyone entering a tender or grant application sooner or later runs into liability insurance as a stated requirement: a defined type of cover, a required limit, a certificate to attach, by a deadline. The good news: this is one of the most plannable types of requirement – if you do not leave it to the last day. This article walks through handling tender situations.
- Tender documents typically ask for a type of cover, a limit and a certificate – sometimes as a condition of the winning contract.
- Getting a certificate is quick if your contract is in order – building new cover from scratch, however, takes lead time.
- Reading the requirement wording word for word is essential: “adequate insurance” and a specific limit requirement are two different things.
What do tender documents ask for?
The range is wide. Simpler tenders just ask for proof of live liability insurance, with no detail on content. More elaborate ones specify a type of cover (public liability, professional indemnity, sometimes a product-liability or environmental element), a limit range, occasionally a deductible cap, and even prescribe the form of the certificate. The strictest ones have the winner take out project-specific cover. In a public-procurement setting, the requirements follow the applicable procedural rules – the wording of the tender document governs, and if you have questions, the supplementary-information procedure can be used.
How to prepare: the steps
Four steps, in order. 1. Screen before you enter: look at the insurance requirement already at the decision-to-enter stage – if the required cover is far from what you currently have, the cost of compliance needs to go into your pricing. 2. Compare against your policy: check every element of the requirement against your policy (checklist) – limit, type, extensions, territorial scope. 3. Fill any gap in cover: if something is missing, the fix is amending your existing contract or adding extra cover – this takes time, so we do not start it in the last week. 4. Certificate: the insurer issues the certificate of insurance with content matching the tender (certificate article, request checklist).
Typical mistakes in tenders
Three recur: the certificate's general wording does not match the tender's specific requirement (the limit is missing, the type does not match); the certificate has expired or does not cover the project's full duration; and in a consortium or subcontractor structure, it is unclear whose insurance covers what (chain article). All three can be prevented by comparing the tender wording and the policy line by line.
The next step
If you have a tender document in hand, bring the insurance requirement to a free consultation – I will tell you what you already have and what is missing; how long it takes to fill the gap depends on the insurer. For repeat bidders, it is worth building things so that your cover is permanently “tender-ready” – that is what the annual-review routine article covers.
Example: the two weeks that were not there
A construction crew is preparing for the first serious tender of its life. The submission is coming together, the pricing is sound – and in the tender's annex sits the insurance requirement: liability cover at a set limit, with a certificate, by the submission deadline. The crew's policy is badly undersized, and there are ten days left until the deadline. Raising the limit and getting the certificate is typically doable under a normal timeline – tight in ten days, but often still workable; the pace is set by the insurer's risk assessment and turnaround time. The lesson for tender bidders: read the insurance annex not in submission week but on the day the tender opens – and repeat bidders should keep their cover permanently “tender-ready”.
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