Certificate of Insurance

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What is a Certificate of Insurance (COI)?

Most businesses will get one, if not several types of insurance. When it comes to insurance, the act of acquiring it is typically the chief concern of the business owner. However, there are times when companies need to verify that they hold insurance and the various kinds of insurance they hold. This is where a Certificate of Insurance becomes useful and at times required.

A Certificate of Insurance is a certified document providing a guarantee that your business is insured. This document is fairly standard. However, it is not typically provided to you by your insurance company without requesting it. Some clients may require you to provide a Certificate of Insurance as a part of an agreement before you start working.

The document only contains essential information about your insurance policy, such as the start date, the kind of coverage the insurance provides and a dollar value of the liability. The document will not contain any personal information, nor will it include any information between the insurance company and the insured. Most certificates contain only a single page of information.

It’s important to note that each insurance carrier can only provide a Certificate of Insurance for policies they have written. If you require several certificates from several providers, you will have to request them each individually.

It is important to understand that a Certificate of Insurance is not the same thing as a Declarations Page. While the two documents have similar information, a Declarations Page is not a material you would want to give to potential clients or others seeking proof of insurance, as it will contain private information, such as the cost of your insurance.

When Will I Need a Certificate of Insurance?

A Certificate of Insurance is a standard requirement for contractors performing high-value jobs. In many cases, businesses must provide this document before bidding on a job. Construction jobs are where this type of document is most commonly required, but anyone requesting your services could make hiring you contingent on proving that you have insurance.

Contractors who perform work on someone else’s property may be required to provide a Certificate of Insurance, too. This request is due to the liability that comes with working on someone else’s property. The more valuable a client’s property, the more likely it is that a business will be asked to produce a Certificate of Insurance

Providing this document is not always in your control as your clients can request this information directly from your insurance company. In some cases, clients will perform this action even after you have provided a copy of your Certificate of Insurance. This is often performed as a security measure, meant to verify that the information provided on your certificate is accurate.

In most situations, potential clients will inform you that you need a Certificate of Insurance before being considered for a job.

Pro Tip: It's always a good idea to ask if you will need this document, or whether it may be helpful during the bidding process. It may even be beneficial for your business to request a Certificate of Insurance from your insurance providers before you begin seeking new clients. This allows you to be prepared in case this document is required.

Still not sure what you need?

Head on over to CoverWallet’s Insurance Checklist. There you’ll find a list of insurance types needed for your industry.