What is a certificate of insurance (COI) in construction?
A certificate of insurance is a one-page summary of a contractor’s insurance. Here’s what’s on it, why general contractors ask for one, and how subs get them.
A certificate of insurance (COI) is a short document that summarizes a business’s insurance coverage. In construction, general contractors ask every subcontractor for one before work starts, to confirm the sub carries the insurance the contract requires. Your insurance agent issues it, usually on a standard form called the ACORD 25.
What’s on a certificate of insurance
Most COIs show the same handful of things:
- Producer: the insurance agent or broker who issued the certificate.
- Insured: your company’s name and address.
- Insurers: the carriers behind each policy.
- Coverages: each policy’s type, number, effective date, expiration date and limits, typically general liability, commercial auto, umbrella or excess liability, and workers’ compensation.
- Description of operations: a free-text box often used to reference a project or job.
- Certificate holder: the company the certificate was issued to, such as the general contractor.
Certificate holder vs. additional insured
These two get confused all the time. Being the certificate holder means the GC received the certificate. It’s informational: the certificate itself doesn’t change your policy or give the GC any coverage.
Being an additional insured means the GC is actually covered under your policy for claims arising from your work. That takes an endorsement to the policy, which your agent or carrier adds. Many GC contracts require additional insured status, so they’ll often ask for the endorsement along with the COI.
Why general contractors require COIs
If an uninsured sub causes damage or someone gets hurt, the claim can land on the GC. Collecting a current COI from every sub is how GCs show they checked, and many hold payment when a certificate on file has expired. That’s why an expired COI can delay a sub’s check even when the renewal is sitting in the sub’s inbox.
How to get a COI
- Get the GC’s requirements: required limits, the exact name and address for the certificate holder, and whether they need additional insured or waiver of subrogation endorsements.
- Send those requirements to your insurance agent and ask for a certificate made out to the GC.
- Check the certificate against the requirements before you send it on.
- Note the expiration dates. When your policies renew, every GC you work for will need the new certificate.
Agents usually issue certificates for their clients at no extra charge. Ask yours how quickly they turn them around, and send requests early when a job is about to start.
How often you’ll need a new one
At least once a year for each GC, because policies renew yearly, and whenever a GC or project needs different wording or limits. A sub working for ten GCs can easily handle dozens of certificates a year. Keeping track of which GC has which certificate, and what expires when, is where most of the work goes.
This guide is general information, not insurance or legal advice. Your contracts and your agent decide what coverage you need.
Choosing how to track certificates? Compare the ways subs and GCs track COIs.
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