As part of our customer education series, we’re training you to request and read your contractors’ Certificate of Insurance (COI) and understand its details. Learning to read this policy is essential if you are working with contractors, service providers, suppliers and vendors.
Contact us today if you need help with your certificate of insurance, and let us customize coverage that’s right for your business.
WHAT IS A CERTIFICATE OF INSURANCE?
A certificate of insurance (COI) is issued by an insurance company or broker indicating what insurance coverages a person or entity had on the date the COI was issued.
WHY IS A COI IMPORTANT?
If your organization hires contractors, they should be required to furnish you a completed insurance certificate before they begin work. A contractor working for your business who does not have adequate liability insurance could expose you to significant losses. You should work with your insurance broker to determine the types and amounts of insurance coverage needed.
HOW LONG SHOULD IT TAKE TO GET A COI?
It can take up to five working days to receive a COI from the insurance carrier. A contractor who cannot provide a COI within a reasonable time span should provide an adequate reason for the delay.
Information on a COI is time sensitive and can quickly become obsolete, so be sure to ask for the most current version.
HOW DO I REVIEW A CERTIFICATE OF INSURANCE?
Ask your insurance broker if they will review a contractor’s COI. If they are not available to assist in a timely manner, use the following guidelines:
Is the insurance broker section complete?
Is the company name the same as the name of the company with whom you’re contracting?
Are the insurance carriers identified?
Are the required coverages checked?
Are the expiration dates current?
Are the policy limits adequate?
Is “any auto” checked under the auto coverage?
Are the company officers included under Workers’ Compensation?
Are you listed as an additional insured by coverage line?
Are the required policy endorsements (if any) indicated?
Are you listed as the certificate holder?
Is there at least a 30 day notice of cancellation?
Is it signed (not stamped) by an authorized representative?
HOW CAN I SPOT A FAKE OR ALTERED COI?
Unfortunately, some individuals or companies are willing to provide false or misleading information. Since copies of blank certificates of insurance can easily be found online, protect yourself by learning how to spot a fake or altered COI.
The publisher of the COI form does not allow any changes or modifications to be made to the formatting of their basic template. A COI emailed or handed to you should be high quality and not look like a reproduction.
The current version of the form should read “ACORD 25” in the bottom left corner. If you have never heard of the listed insurance carriers, call your broker to determine if the companies are legitimate.
Look for spelling and grammar errors, mismatched font types, sizes and colors. Check for typing in the filled-in areas that appear to have changes in their background texture.
If a contractor is willing to submit a false COI, they may be concealing more. Never let a contractor work for your business without a current COI on file!
NEED FURTHER HELP WITH A COI?
Centurion’s in-house Risk Management Specialist, Rob Brooks, is also available to provide remote or on-site training on this topic. You can reach Rob to set up a training at firstname.lastname@example.org or 606.434.0739.
This presentation is for informational purposes only. The suggestions offered here are not comprehensive or final. It should be understood that there are other options that may be needed to reduce risks of this nature. Neither Centurion Insurance Services or its affiliates shall have any liability for any direct, indirect, special or subsequent damages, whether in contract, strict liability or tort arising in any way out of the use of this material.