What Are Certificates of Insurance and Why Do We Need Them?

Michael Harrill
Written on July 28, 2020

Most agreements/contracts have “insurance requirements” or something similar that required you, the insured, to have certain coverages in place. These contracts typically request this coverage to be shown on a declarations page or what is called a certificate of insurance (COI). Because it is inconvenient to print the declarations page of every policy, Capitol Insurance provides its clients with a COI that summarizes the coverage for one named insured.

What is a certificate of insurance?

A certificate of insurance is a form that is typically issued by the insurance agency if they are authorized by the carrier. Typical information provided on a certificate includes contact information of the insured, policy number(s), coverage dates, and a description of the coverage in the policies listed.

Why use a certificate as opposed to an actual policy?

Rather than requesting and printing copies of all the different policies we handle; it is much more convenient and secure to use a certificate of insurance. The certificate is a one or two page document that will not provide any confidential information that would be shown in the actual policy such as sales and payroll information.

Are certificates of insurance the same as an actual insurance policy?

No, they are not. There are several limitations to a certificate of insurance that are specified in the disclaimers on the ACORD document that is used. Certificates of insurance can only confirm that coverage is in place at the time it is issued. Those disclaimers make it clear that the certificate of insurance is “for informational purposes only” and that it does not “amend, extend, or alter the coverage afforded by the policies.” Therefore, this document is not a legal equivalent of an insurance policy. Courts will typically enforce the language of the policy over the certificate of insurance in the event that there is a conflict between the two.

Have more questions about certificates of insurance? Reach out to us, we would love to help!