Foire aux questions

A "3-head" policy is a type of coverage specific to the transportation industry, mainly used for commercial trucks. It gets its name from the fact that it covers three distinct aspects under a single policy :

1. Commercial automobile insurance
   1. Third-party liability: Covers damage you may cause to others (bodily injury or property damage) while operating your vehicle.
   2. Vehicle Damage: This policy protects your vehicle against damage, whether caused by collision or other causes (theft, vandalism, etc.).
2. Cargo insurance: Covers the goods you transport against loss or damage during transit.
3. Commercial General Liability insurance: Protects your business against the financial consequences of harm inflicted on a third party. In other words, if your company is responsible for an accident or incident that results in injury, property damage or consequential loss to another person, this insurance covers the associated costs.

Several strategies can help reduce your premiums :

• Invest in ongoing training for your drivers.
• Implementing a safety and risk prevention program
• Installing safety technologies in your vehicles (GPS, onboard cameras, etc.)
• Opt for a higher deductible if cash flow permits.
• Consolidate your various insurance policies with a single insurer.

Our experts can advise you on the best options for optimizing your coverage while controlling costs.

Coverage for cross-border operations depends on your specific policy. Generally speaking, standard insurance does not automatically cover operations in the USA. You'll probably need extended coverage or a particular policy for cross-border operations.

At Covalen, we can tailor your policy to include adequate coverage for your international activities, considering both countries' regulatory requirements.

It protects your fleet management systems, GPS tracking systems and customer data against cyber attacks. It can also cover system interruption losses and much more !

Essential coverages generally include :

• Commercial automobile insurance
• Cargo insurance
• Commercial general liability insurance
• Business interruption insurance

The exact combination will depend on your specific business. At Covalen, we analyze your needs and tailor our coverage.

It depends on your policy. Specific coverage for refrigerated goods is often required. We can customize your policy to include this protection. Talk to your broker.

Sectors requiring surety bonds :

Surety is crucial in many business sectors, ensuring confidence and financial security in business relationships. Although requirements vary according to specific projects and contracts, certain fields stand out for their frequent use of surety bonds.

The construction and civil engineering sector is at the top of the list. Surety bonds are often mandatory for large-scale public or private projects, guaranteeing the proper execution of work and payment of subcontractors.

Companies working with governments and municipalities are also significant users of surety bonds. These guarantees protect public funds and ensure that contracts are carried out according to agreed terms.

Surety bonds are commonly required for transport licenses, customs obligations, and major freight contracts in the transport and logistics sector. They guarantee compliance with regulations and contractual commitments.

The manufacturing and distribution sector uses surety bonds for significant supply contracts, product guarantees and export projects, ensuring the confidence of business partners.

Finally, the information technology industry increasingly uses surety bonds, particularly for government software development contracts and large IT infrastructure projects.

At Covalen, we understand that every business is unique. Your projects may require bonding even if your industry isn't listed here. Our team of experts is here to assess your particular needs and offer tailor-made solutions, whatever your field of activity.

Understanding the cost of a surety bond : Key factors and considerations

The cost of a surety bond is not a fixed value but rather the result of carefully evaluating several factors. At Covalen, we strive to provide competitive rates by analyzing each situation individually and thoroughly.

Your company's financial health is a key element in this assessment. Strong financial statements, a balanced balance sheet and good cash management, are positive indicators that can help reduce the cost of your bond. We look closely at these aspects to assess your company's financial stability and reliability.

Your credit history also plays a crucial role. A good credit record for both the company and its management demonstrates responsible financial management and can positively influence the cost of the bond.

The value and duration of the contract for which you request a bond are determining factors. Larger or longer-duration projects can represent a higher risk, impacting the bond cost.

Your experience in the field is a valuable asset. Proven expertise and a history of similar successful projects can strengthen your profile and potentially reduce the bond cost.

At Covalen, our personalized approach allows us to consider all these factors and the unique specifics of your company and project. We are committed to working closely with you to understand your needs and offer you the most advantageous bonding solution possible. We aim to provide you with the best rate and the most appropriate protection for your situation.

The most common types of surety bonds: An essential guide

Surety bonds provide crucial financial guarantees in business and construction. Among the variety of surety bonds available, three types stand out regarding frequency of use and importance.

The bid bond is often the first to be encountered in tendering. It assures the client that your company will honour its bid if it wins the contract. This bond demonstrates your seriousness and commitment, positioning you as a reliable candidate.

Once the contract has been awarded, the performance bond comes into play. This crucial guarantee assures the customer that your company will complete the project according to the agreed terms. It covers aspects such as quality of work, adherence to deadlines and compliance with contract specifications. In default, this bond protects the customer against potential financial loss.

Finally, the payment bond offers essential protection to subcontractors and suppliers involved in the project. It guarantees they will be paid for their work and materials, even if the main contractor has financial difficulties. This type of bond fosters confidence in the supply chain and ensures the smooth running of the project..

At Covalen, we understand that each project is unique and may require a specific combination of these bonds. Our team of experts is here to guide you in choosing the right surety bonds for your needs, ensuring that your interests are protected and your projects succeed.

Understanding the bond claim process

When a claim is made on your surety bond, it's crucial to understand the process and its implications. Although claims are rare when projects are well managed, it's essential to be prepared for this eventuality.

The process begins when the bond beneficiary (usually the client or owner) files a claim with the surety company. The surety company then undertakes a thorough investigation to verify the claim's validity. This often involves document gathering, interviews with the parties concerned, and a detailed analysis of the claim's circumstances.

If the claim is deemed valid, the surety company proceeds with payment to the beneficiary in accordance with the terms of the bond. This payment covers any loss or damage the beneficiary suffers due to non-compliance with contractual obligations.

It is crucial to understand that this payment is not a simple indemnity. As the bondholder, you are responsible for repaying this sum to the surety company. This repayment obligation is a fundamental feature that distinguishes surety bonds from insurance.

At Covalen, we believe in a proactive approach to minimizing the risk of claims. We work closely with our customers to identify potential problems before they escalate. In the event of a claim, our team of experts guides you through the process, seeking solutions to resolve conflicts and protect your interests. We aim to manage claims efficiently, preserve your relationship with the beneficiary, and maintain your bonding capacity for future projects.

Insurance vs. Surety: Understanding the essential nuances

Financial protection takes many forms in the business world. Insurance and surety bonds are two often confused but fundamentally distinct financial tools. Understanding their differences is crucial to choosing the proper protection for your business.

Surety acts as a performance bond. It assures your customer or beneficiary that you will fulfill your contractual obligations. In the event of default, the surety company indemnifies the beneficiary, but you must repay this sum. It's a three-way relationship involving you, the beneficiary and the surety company.

On the other hand, insurance protects your business directly against specific risks. You pay premiums to transfer the financial risk to the insurer. In the event of a covered loss, the insurer indemnifies you without waiting for reimbursement. It's generally a two-way relationship between you and the insurer.

The key distinction lies in the protection. Bonding guarantees your performance, while insurance protects you against loss. In the event of a claim, you reimburse the surety company but not the insurer.

At Covalen, we recognize the importance of both tools in managing your company's risks. Our team of experts is here to guide you in choosing the optimal combination of bonding and insurance. We analyze your needs to offer comprehensive, tailor-made protection, ensuring your business's financial security and growth.

Nos courtiers spécialisés peuvent vous aider à trouver des options d'assurance alternatives.