The most common and most likely answer to this crossword clue is the 11 plus 1 plus 8 letter word CONTRACTUAL - CONTRACT
I've seen this crossword clue in The Times
C
O
N
T
R
A
C
T
U
A
L
-
C
O
N
T
R
A
C
T
Buddy explains!
The straight part
We know that "covered by agreement" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case covered by agreement = contractual - contract.The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.