Certificate of Insurance Procedures
Other People Are Reading
-
Getting Insured
-
A Certificate of Insurance is a document that certifies a business's level of insurance coverage. This insurance may cover items such as General Liability, Workman's Compensation, Automobiles, and a variety of other needs. In the event of an injury or lawsuit, the insurance will generally protect the assets of the business, as well as associated individuals. The process of obtaining a Certificate of Insurance starts when the business purchases coverage from a local insurance agency or underwriter. The agency can help the business owner understand what kinds of coverage he should consider, as well as how much of each type of coverage is recommended. Insurance costs are generally based on the risks the company will be exposed to, along with local accident rates.
Requesting a Certificate
-
Most businesses will require a Certificate of Insurance when they interact with another business or agency. For example, if a university hires a contractor to perform work, they will exchange insurance certificates to verify coverage. In this case, each of these organizations will contact the insurance agent and request that a copy of the certificate be sent to the appropriate party. To prevent fraud and tampering, the certificate is almost always sent directly from the agent to the organization requesting verification, and not to the client.
-
Additional Requirements
-
In many cases, an organization that is requesting a Certificate of Insurance from another business will list specific requirements that must be met. For example, if an organization wanted to rent a local event hall for a day, they would request a Certificate of Insurance from the event hall. This would verify that the organization was protected under the hall's insurance in the event of an injury or accident. To further protect itself, the organization may request that they are added as "Additional Insured" on the Certificate. For a small fee, the hall's insurance agent will modify the Certificate of Insurance temporarily to include the organization in all of the hall's coverage. In some cases, the organization may even require that coverage limits are raised, or that umbrella policies are added to cover their event.
-
References
- Photo Credit Creative Commons, Elembis
