You may be asked to provide a certificate of insurance from a client financial institution insurance company event venue and by many other individuals or companies. But what is a certificate of insurance? How do you get a certificate of insurance? We’ll explain what they are why they are requested and how to get one in this article.
What is a certificate of insurance?
A certificate of insurance is a document that verifies the existence of an insurance policy and provides information on what that insurance covers including:
- Types of coverage
- Limits of coverage
- Policy numbers
- Names of insureds
- Insurer details
- Policy effective dates
The certificate of insurance is issued for information purposes only. It does not amend the terms of the policy and often contains a disclaimer to that effect. Something like the certificate is not itself an insurance policy it only proves that a policy exists .
Why are certificates of insurance requested?
Certificates of insurance are requested as proof of insurance. This helps clients or businesses mitigate their own risks by ensuring they and you are protected.
For example financial institutions often request certificates of insurance before lending money to ensure what they’re financing is protected. For example if you’re buying a home and need a mortgage your lender will require a certain type and amount of insurance for the property. They will request proof in the form of a certificate of insurance.
Another example is if you finance a car. The lender will also require collision and comprehensive coverage and request a certificate of insurance to prove you have the vehicle protected to the right level.
Contractors require proof of insurance to protect themselves in the event of something going wrong during a project. It gives the customer the peace of mind that the business is covered and that they are protected. Savvy shoppers will often make this request when shopping quotes and proposals for renovations and other major projects. If you are a business owner with clients of this nature it’s a good idea to have it on hand before they ask for it or even submit it alongside other documents when bidding for a job.
These are just a couple of examples where a certificate may be required. It’s a fairly common request particularly if money and contracts are involved.
How do I get a certificate of insurance?
Some insurance providers include the certificate of insurance in the policy documents package they send you when you become a customer. If your insurer doesn’t do this no need to fret. Getting a certificate of insurance is easy and insurers are obliged to provide one upon request.Your broker can handle this for you. Simply let them know and they’ll do all the necessary legwork.