In practice，the manufacturer can control the supplier’s quality by means of business insurance， hence reducing the potential business loss induced by component defects. However，the cost of business insur- ance is relatively high，which may lead suppliers to despise the seriousness of quality problems，and then a- bandon quality improvement. Based on a procurement contract decision model of two-echelon supply chains in single period under complete information，this paper studies how the manufacturer can take advantage of busi- ness insurance to manage the quality risk of supply chains. By comparing the manufacturer’s profits under the no-insurance strategy with that under business insurance strategy，it aims to explore the implementation condi- tions of the business insurance strategy，and gives the optimal purchase contract and the business insurance strategy. Theresultsshowthat: (1) Ifthesupplierissmallinsizeandpoorinanti-riskcapacity，thebusiness insurance strategy can eliminate the constraints of risk tolerance on transactions of the two parties and promote transactions; ( 2) If the supplier is large in size and strong in anti-risk capacity，the manufacturer can take ad- vantage of business insurance strategy to reduce the purchase price of components and to raise the expected profits; ( 3) The optimal strategy for the manufacturer is to insure for the full value if it insures; ( 4) The im- plementation of business insurance does not necessarily lead to a decline in component quality. When the quality cost or the supplier’s risk tolerance is relatively low，there is a complementary effect between business insurance strategy and quality improvement. When both the risk tolerance and the quality cost are high，there is a substitution effect between business insurance strategy and quality improvement.