Certificate of Insurance

Do You Need a Certificate of Insurance?

When a contractor works on another person’s property, there are risks involved. Contractors can sometimes damage personal property or may even be injured while performing the work. Companies and individuals that hire contractors want to be certain that they will not be held liable for injuries, damages or substandard work. For this reason, they will frequently request to see a certificate of insurance.

Whether you are a contractor who needs to present a certificate of insurance or a hiring company who is requesting to see one, you can get assistance from an independent agent in the Trusted Choice network. These agents are conveniently located in more than 27,000 locations nationwide, so it is easy to find a member agent close to your home or business. Contact a local agent today to learn more about certificates of insurance.

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Certificates of Insurance in Liability Lawsuits

Approximately 1 in 25 errors and omissions (E&O) claims involves a certificate of insurance.

Of these, 36% represent cases in which contractors have failed to add, or improperly identified, additional parties to be insured.

21% of these cases involve instances where the holder of the certificate has misrepresented coverage or claimed to have coverage that does not exist.

What Is a Certificate of Insurance?

A certificate of insurance form is a standardized document that provides evidence of insurance coverage. It will include the contractor’s coverage types and liability limits. This certificate also lists the effective date of the policy.

Why Is a Certificate of Insurance Important?

If you hire a subcontractor who causes a large amount of property damage, your company can be held liable for these damages. Even if the terms of your contract with the subcontractor clearly state that insurance coverage is mandatory, you could be sued if the coverage simply isn’t there. This is why you must ask for proof if insurance coverage.

Who Should Request a Certificate of Insurance?

If your company hires subcontractors, it is extremely important that you get a certificate of insurance from each one you work with.  Even if you trust your subcontractors – for example, if you have worked with these contractors in the past and knew them to have insurance at the time – you should submit a certificate of insurance request each time you hire them onto a new job. Doing so can prevent a scenario where you inadvertently take on the risks associated with the work your subcontractors perform.

Be sure to ask for a certificate of insurance before allowing contractors to work on your property, if you have work done on your home, condo or landscaping. Taking this important measure can cover your risks in several ways:

  • It can prevent you from taking on risk if an improperly insured company is responsible for property damage. For example, if a contractor is working on your property and inadvertently damages your neighbor's trees, shrubs, lawn, landscaping or home, you will not be held responsible.
  • It will ensure that you are not held responsible for a contractor's medical bills if that contractor is injured while performing work on your property.
  • It will also ensure that you can receive compensation if the work is poorly done or not completed. In this case, you would be able to go to the contractor's insurance company to file a claim.

What Should I Look for on a Certificate of Insurance Form?

Not all certificates are valid. Contractors may present false or forged information or may allow insurance to lapse after attaining the certificate of insurance form. You can eliminate many instances of fraud by requesting the business insurance certificate directly from the insurance company instead of getting it through the contractor.  

The following are some things to pay close attention to when you receive a certificate of insurance:


Confirm that the name of the insured on the form is an exact match for the name of the person or company you are hiring.


Check the policy coverage dates to ensure that they are valid. If the policy is due to expire before the job will be completed, you will need to be sure to get another certificate of insurance at that time.


Ensure that the certificate holder has, at a minimum, both general liability insurance, to protect against damages, and workers compensation insurance, to protect you in the event that the worker is badly injured on the job.


Make sure that the liability limits held by the contractor meet the liability limits you require of your workers. If they are not high enough, you can request that the contractor purchase additional coverage and present you with a new certificate.


Ask to be named as an additional insured party for the duration of the project or contract for which you are hiring the worker.

What Is Certificate of Insurance Tracking?

If you deal with several different subcontractors, you may want to hire a certificate of insurance tracking firm. These companies will verify the coverage that has been represented on the certificates and can ensure that the policies are still in place before each job. When the policy dates on the certificate expire, they will provide notification that a new certificate of insurance is needed.

Get More Information About Certificates of Insurance

A certificate of insurance is an important document for those who wish to protect themselves from possible lawsuits and financial losses. Independent commercial insurance agents in the Trusted Choice network understand this. These agents deal with business insurance issues every day and are equipped to answer your questions.

Speak with an agent in the Trusted Choice network for more information about certificates of insurance today. These agents may even be able to find you better rates on the insurance coverage you already have. Contact an agent in your neighborhood to get started getting the coverage you need.

Now, who's ready to get their insurance problems solved?