What is a Certificate of Insurance?
Evidence that an insurance policy has been issued, showing the amount and type of insurance provided. It may be used as evidence of reinsurance between companies, and it is the document containing specific details of property covered by Master or Open Policies. Marine insurance copies marked “original” and “duplicate” are issued as negotiable documents. In other words a printed certificate that states the essential provisions of your coverage, often required by customers who want proof you have insurance.
This form is used by your insurance carrier or authorized representative (your agent) which is provided to a certificate holder (requester), and verifies that your business (either sole proprietor, partnership, corporation, limited partnership or LLC) is insured for liability, the limits of liability, and for a specified period of time. Requests for certificates are made by your customers, general contractors or government authorities. Certificate holders are also notified in the event that your liability coverage is canceled, giving them 30 days notice of cancellation for cause or non-renewal. They are given notice, as well, if your policy is canceled for non-payment of premium. There is no charge for providing a certificate.
A Certificate of Insurance verifies that the contractor, consultant, or facility user has purchased an insurance policy and that the insurance requirements of the contract have been met. It provides evidence that the insured can satisfy obligations to (1) pay for loss of or damage to property, (2) pay judgments or settlements, (3) protect The Regents if costs are incurred as a result of the insured’s negligent acts or omissions, and/or (4) support the indemnification provisions of the contract. One of the most common certificates is the ACORD Certificate of Insurance form. See Quick Tips: Understanding the Acord Certificate of Insurance.
