What is a certificate of insurance (COI) and why am I being asked to provide one?

A certificate of insurance is a document issued by an insurance company/broker that is used to verify the existence of insurance coverage under specific conditions granted to listed individuals. More specifically, the document lists the effective date of the policy, the type of insurance coverage purchased, and the types and dollar amount of applicable liability (Definition from Investopedia).

If you are being contracted to perform a job (i.e. construction, plumbing, etc.) you may be asked to provide a certificate of insurance. This will prove to your client that you are covered in the event of an incident or claim. Depending on the type of job you are providing, the client will ask for proof of various policies. The two most common policies that are required are General Liability Insurance and Workers’ Compensation Insurance. Proof of General Liability will show that you are insured in case any damages arise from the work you provided to the client. The client is interested in Workers’ Compensation insurance in case any of your employees are hurt on the job on their property.

In addition to a certificate of insurance, you may also be asked for various endorsements including Additional Insured (AI), Waiver of Subrogation, Loss Payee, just to name a few. Additional Insured endorsements are the most common; a client may ask to be “named as additional insured”. This means that the company you are working for will be covered in the event of a claim occurring from your work. Insurance carriers can either provide a Blanket Additional Insured endorsement, which covers any client noted on a certificate of insurance, or a Specific Additional Insured endorsement, which will name the specific company on the endorsement itself.