That sounds a lot like an employee I had years ago. Similar situations came up a lot. I didn't deal with it in a good way, normally I'd wind up doing the work myself instead... I think it doesn't actually come from a place of concern as stated, I think it's more an excuse to not have to work
In your case, I would say something to the effect of thank you for the advice, we'll be sure to have a solid contract and make sure we have everything in order. See how that goes over.