Certificate of Insurance

A certificate of insurance (COI) is a one-page document issued by an insurance company or broker that summarizes the key details of an active insurance policy. It shows the policyholder's name, the types of coverage in force, coverage limits, policy numbers, and the effective and expiration dates. A COI does not create, modify, or extend coverage. It is proof that a policy exists, not the policy itself. In the United States, almost all COIs are issued on the standardized ACORD 25 form.

Think of a COI like a passport: it verifies your status and identity in a standardized format that others recognize, but it does not confer the rights you hold; it just proves you have them.

Construction, Real Estate, and Vendor Contracts Are the Most Common COI Contexts

In construction, a general contractor typically requires every subcontractor to provide a COI confirming they carry general liability insurance and workers' compensation insurance before allowing them on a job site. The GC is usually named as an additional insured on the subcontractor's policy. In real estate, commercial landlords require tenants to provide a COI before occupancy begins. In vendor relationships, companies require COIs from suppliers, caterers, IT contractors, and other service providers before work commences.

The Certificate Holder and the Additional Insured Are Different Roles

A certificate holder is the party that requests the COI and has its name and address listed on it. Being a certificate holder does not give that party any rights under the insurance policy. An additional insured is a party that has been specifically added to the policy itself and can make claims against it directly. If a subcontractor's liability insurance pays a claim for property damage at a construction site, an additional insured general contractor can receive coverage under that policy. A certificate holder who is not named as an additional insured cannot.

Request COIs Before Work Begins, Not After

The most common mistake is waiting until an incident occurs before asking for a COI. At that point, if the contractor or vendor is uninsured or underinsured, the hiring party is exposed to the full loss. Requesting a COI before signing a contract or allowing any work to start gives you time to identify coverage gaps, require corrections, or engage a different provider. Construction injuries alone cost $11.5 billion annually in the United States according to the Bureau of Labor Statistics, which illustrates why pre-work COI verification is standard practice in any industry involving contractors.

Sources:
https://www.travelers.com/resources/insurance-101/certificate-of-insurance
https://www.thehartford.com/business-insurance/certificate-of-insurance-coi
https://www.geico.com/information/aboutinsurance/business/what-is-a-certificate-of-insurance-coi/
https://billyforinsurance.com/resources/what-is-a-coi-heres-how-to-read-and-interpret-a-certificate-of-insurance/