Understanding Insurance Requirements in Mexico
Creating a thorough verification process is a top contractor management priority for Hiring Clients in Mexico. For years, Hiring Clients and contractors have found discrepancies between local jobsite requirements and documentation. This often leaves Hiring Client companies at risk of assuming liability for potential incidents. ISNetworld provides a review and verification process for Hiring Clients to keep track of all their contractors. Through ISNetworld, ISN collects, reviews and stores information for the Hiring Clients’ suppliers and contractors in one location. This allows the Hiring Client to streamline their qualification process and to evaluate their contractors and suppliers based on the specific criteria they establish, including insurance. While insurance is a central part of most risk management strategies, numerous Hiring Clients in Mexico have discovered after joining ISNetworld that a high percentage of their contractors’ insurance policies did not comply with their requirements. Insufficient coverage or documentation have been the primary factors of noncompliance. Download our one-page brochure on insurance requirements in Mexico for an abridged version of this post. Insurance by the Numbers As of 2019, there are more than 500 Hiring Clients across 21 countries that require insurance documents to be submitted to ISNetworld There were 590,000+ insurance reviews completed by ISN in 2018 and 320,000+ in the first half of 2019 ISNetworld has more than 5,300 registered Insurance Agent/Broker subscribers More than 50% of Hiring Clients in Mexico require insurance documents from contractors in ISNetworld Most Frequently Required Insurance Policies by Hiring Clients in MexicoWithin an insurance exhibit document, a Hiring Client will typically dictate the types of policies and amount of coverage required for a contractor. Certain types of work or projects may require specialty coverage in addition to the standard minimum requirements. Commercial General Liability: Protection against claims for personal and bodily injuries and property damage resulting from a company’s operations Automobile Liability: Protection against claims resulting from the use of a company’s vehicles Specialty Policies: Depending on a company’s scope of work, required policies may include excess, professional, pollution and/or marine insurance, among others The Most Common Discrepancies in Insurance ReviewsThere are several discrepancies that result in rejected insurance policies. One missing or insufficient requirement will result in a deficient insurance status within ISNetworld. The most common discrepancies in Mexico include: Insured/company name does not match the company name in ISNetworld Expired policy dates Insufficient policy limits The coverage territory does not specifically state it applies to Mexico Automobile policies in Mexico also differ from the United States. In the U.S., an auto policy typically covers a variety of vehicles that are being used, but in Mexico, an automobile policy is issued per automobile. Another common scenario in Mexico is contractors may be required to provide higher than the minimum state-required limit for their automobiles. To avoid this potential deficiency, contractors can meet these higher limits through an excess policy that would cover the remaining required coverage. Best Practices for ComplianceContractors should follow a series of best practices when seeking to comply with Hiring Client insurance requirements: Use the Agent/Broker ToolThe ISNetworld Agent/Broker subscription allows contractors’ insurance providers to access Hiring Clients’ insurance requirements, submit documents on behalf of contractors and receive renewal reminders by email. Provide the necessary documentationOnly upload the necessary documents required by Hiring Clients. For example, do not upload insurance documents for a vehicle that is not used on a Hiring Client’s site. Submit your renewal policies before your current policies expireISNetworld will send contractors reminders starting 35 days prior to policy expiration dates to allow time for contractors to renew policies and submit for review. Use the Variance Tool when necessary This ISNetworld tool allows contractors to request exceptions from Hiring Clients for requirements that do not apply to the contractor’s scope of work or agreement. Let ISN HelpIf you are a Hiring Client and have questions about insurance requirements for your contractors, contact your ISN representative for more information. Are you a Hiring Client interested to learn how ISN could help you manage your contractors and insurance requirements? Request a demo of our contractor management system, ISNetworld. If you are a contractor who needs help submitting insurance requirements through ISNetworld, contact our customer support team for more information. Download our one-page brochure on insurance requirements in Mexico for an abridged version of this post.