Ever been asked to provide a Certificate of Insurance?

Posted in: Commercial Insurance

A question I hear from clients often is “How do I get a Certificate of Insurance?” A request for a Certificate of Insurance (COI) may be the most frequent interaction you have with your property and casualty broker or your insurance carrier.

If you’ve never had to obtain a COI before, here’s an overview of what a COI is and how to request one.   

What is it?

A COI is used to provide proof to a third party that your company has insurance of a certain type — e.g., liability or property insurance — with certain limits in place. It also identifies the insurance company that underwrites the policy, and is signed by your authorized insurance representative.

Why would anyone request a COI from you?  You may receive these requests from a third party with whom you are conducting business – your landlord, bank, auto or equipment leasing company, clients as a requirement of client contracts, or from a venue where you are exhibiting or holding an event. A COI indicates that you have the necessary financial resources to cover their potential losses in case you cause any harm or damage to them as a result of your negligence.

The certificate is issued to a Certificate Holder, who is the entity requesting that you provide proof of coverage. The requirements that underpin a COI can vary, but they often include some of the following elements:

  • That certain types of insurance coverage be in place and for certain limits
  • That the company providing the coverage has a sufficient A.M. Best rating
  • That the coverage be primary – insurance that covers up to the policy’s limit whether or not other policies cover the same risk
  • That specific language and information (such as being named as additional insured, having a waiver of subrogation in favor of the certificate holder, written notice of cancellation, deductibles not to exceed a certain value, and references to specific locations, events, or loan numbers) be included on or with the certificate of insurance as attached endorsement copies

How do I get one?

Ask your broker or account manager to issue the certificate. At PSA, we aim to issue the document within one business day or faster! To issue the certificate, we will need some information that is required to be included:

  • Formal name and address of the Certificate Holder (the requesting entity)
  • A copy of the insurance requirements section of the contract, lease, notice, or email received that requests the certificate

If a certain coverage is required that you currently don’t have, your broker can help you make the necessary adjustments. Alternatively, specific coverages, limits, and special requirements can often be negotiated out of a contract and an agreement reached to accept current coverages.

And that’s it! The certificate is transmitted to you and/or the Certificate Holder at your direction. Your broker keeps the Certificate Holder’s information and the required certificate information on file for the next policy renewal. When policies are renewed, new certificates are issued to Certificate Holders on file if evidence of coverage is still required.

For more information on Certificates of Insurance, please feel free to contact me at cmorsberger@psafinancial.com.