What is a Certificate of Insurance Review?
A certificate of insurance (COI) is a document provided by an insurer that confirms the insurance policy and states all its terms and conditions.
It’s common for individuals such as business owners and contractors to make use of these documents to validate that they own insurance protecting them from liabilities or risks.
Read the rest of this article to learn about what’s typically included in a COI, what to look for when reviewing a COI, and how a lawyer can help you by conducting a thorough review that gives you peace of mind.
What’s Included in a Certificate of Insurance?
A certificate of insurance can be defined as a summarized version of an insurance policy. It includes the following information:
- Details of the insurance company (name and address)
- Details of the insured (name and address)
- Policy number
- Insurance policy effective and expiration dates
- NAIC (National Association of Insurance Commissioners) number for the insurance company. This confirms that the company is licensed.
- Coverage details (such as liability limits)
How Should You Review a Certificate of Insurance?
When you receive a certificate of insurance, you should check all the information it contains to ensure that it’s accurate and you have the coverage you require for the project you’re undertaking.
Here are some things you should check during the document review.
- Check the company name. It should be the same as the company you’re dealing with, so be wary of any incorrect spelling or a different legal entity.
- Ensure your name is correct. While it sounds simple to say you should check your name, any inaccuracies can result in a lack of coverage.
- Look at the policy limits. It’s crucial to check the policy limits as you don’t want the limits to be too low or the aggregate to be partially used up.
- Check policy dates. The COI should provide coverage for the entirety of your work period without any gaps.
- Check signatures. You want to check that the certificate is signed by the insurer.
- Confirm cancellation notices. They must be acceptable and fair to all parties involved.
- Remember any special requirements. If you’ve specified them, the certificate needs to include them.
- Look for a contract number. Depending on the project, the certificate needs to contain the contract number. This serves to allocate the insurance to the specific work that needs to be done.
- Spot any changes. Check that no changes have been made to the certificate that aren’t approved.
- Validate your insurer. Verify that your insurer is authorized to practice in your state.
What Key Terms in a COI to Look For
A COI has some important terms to know about, which will help you when reviewing it. Here are terms you might see in your document.
- Additional insurance (AI). This refers to coverage extensions that protect the insured with someone else’s insurance policy.
- Waiver of subrogation (WOS). These are provisions to prevent insurers from pursuing recovery from you for paying a claim.
- Primary and non-contributory (P&NC). If there are multiple policies involved, the primary one will pay the claim without seeking contributions from any others.
- Commercial General Liability (CGL). This is basic and essential coverage that protects you against claims of third-party injury or property damage.
- Umbrella coverage (UMB). If your claim is larger than what the policy can cover, you’ll get extra coverage.
- Workers’ compensation (WC). This protects workers against injuries on site and protects the company against someone taking legal action against them in the event of something going wrong.
Do You Need a Lawyer for a Certificate of Insurance Review?
Whether or not you require a lawyer to review your certificate of insurance depends on a few factors, such as if you’re dealing with a low-risk project or a more complex arrangement.
You should hire a lawyer in the following instances:
- You’re dealing with a high-risk project, such as in construction or engineering.
- You have complex requirements in your contract. For example, you want additional insurance terms included.
- Your contract value is high and you’re worried about any gaps or legal issues that could cause you financial problems.
- Your drafted COI is vague or ambiguous, which can be open to misinterpretation and result in future disputes.
Even if the above doesn't apply to you, it’s always beneficial to consult with a lawyer to ensure the COI is legal, fair, and protects you. Here are some common ways in which a lawyer will help you with a COI review:
- A lawyer is skilled at identifying gaps in insurance policies and other documents. They will check for anything in the policy that doesn’t match what’s included in the COI.
- They’ll check that you’re sufficiently covered should something happen.
- They’ll explain any vague or confusing language so that you understand everything.
- They’ll look for any red flags, such as if umbrella coverage is incorrectly defined or the policy expiration date will occur prior to the project coming to a close.
- They’ll be able to enforce the terms in the COI and negotiate them on your behalf to protect your rights and interests.
- They’ll be thorough about the review and will use their expertise and experience to notice things you might have missed during your read-through.
Do you need to hire a lawyer for a COI review?
When you need a lawyer to review a business document, such as a COI, you might struggle to know where to find one you can trust. ContractsCounsel, an online legal network, makes it easy to connect with vetted lawyers on the platform.
You can post a project on ContractsCounsel for free, requesting a COI review. Specify some project details so lawyers will know what you require. Then, you’ll receive lawyer bids for the project. View the lawyers’ profiles to learn more about their expertise, experience, and similar projects they’ve completed on the platform. This helps you to choose the best lawyer in your location for your requirements.
