Master Service Agreement Insurance Clause

The main advantage of this section is that, in order to enable the Agency to meet its deadlines and obligations for the client, it needs an agreement on the expectations for timely verification of customer feedback. Many professional services organizations have solved this challenge by providing an MSA that serves as the basis for the relationship to which they can then refer for future agreements based on projects you create to keep project agreements as focused and thin. For some technology transactions, for example, the parties enter into a separate technology licensing agreement and then a Master Service Agreement to address all related services. There are related agreements with your ASM, you must ensure that the entire structure cooperates and that contractual remedies are coordinated. This is often an important area of negotiation when multiple agreements are used. A recent court case, Duval v. Northern Assur. Co. by Am., 2013 US App.

LEXIS 13680, showed that the extra language is not always correct. A third-party insurer asked the court to comply with the MSA`s insurance requirements that did not apply to any of the companies, BHP. The court ruled in favour of BHP and did not invoke any previous cases. When setting up an MSA, you should focus on including four things in the agreement: a master service contract generally contains detailed insurance requirements that service providers must meet, including the requirement to collect and maintain certain types of insurance for certain amounts, the designation of the client as an additional insured status or other insurance-related statutes, and the provision of confirmation documents attesting to their compliance. It is important that the client and service provider`s insurance advisors understand the relationship between the parties, where and what services are performed, what types of services are affected, and what the distribution of risk is between the parties. In many cases, insurance is the main source of financing for the risks that are allocated between the parties by the Master Service Agreement, such as specific compensation obligations.B. It is important to note that a client`s insurance claim does not serve as guidance for the insurance service provider. Customer requests often focus on certain high-risk areas frequently mentioned, while a service provider may need coverage (and much higher limit values) that are not requested by a client to protect itself and its operation. A master service agreement model has often attached insurance requirements as exposure, making them easier to update based on the services provided. Risk allocation is the other factor. If companies accept an MSA, the new agreement may affect existing contracts.

Insurance contracts are particularly important. An MSA will protect the parties by establishing the risks to each business. It also decides on the responsibility of each group during the life of the project. With an MSA, dispute resolution is easier.