You've probably heard of a Certificate of Insurance (COI) while conducting business, but may not understand the exact meaning of the phrase or why you need it. In short, a COI is a document that will protect you, your business, your crew, and your clients. It is pretty straightforward to produce, and it is immensely beneficial to always keep one on-hand.

What is a Certificate of Insurance (COI)?

A certificate of insurance (COI) is a succinct document that will prove your insurance policy, and then summarize the key terms of that policy. Some of those important aspects include:

  • Your (or the policy holder’s) name
  • The insurance company or broker issuing the policy
  • The effective dates of the policy
  • The scope and type of coverage
  • Any limits your policy might contain
  • The policy number

A COI is usually given to you, the business owner, by your insurance company or broker. It is popular with small-business owners and contractors because it protects and provides liability coverage for any potential workplace or project-site accidents.

3 Reasons Why You Need a COI:

You and your business will be more trusted.

Anyone can tell a client that they have insurance, but without a COI there is no proof. When you are able to produce a COI to your potential clients, they have validated trust in you and your business practices. Further, when you are able to produce a COI, it makes growing your business and partnerships much easier and more likely. Practically everyone is going to ask for proof of insurance, so if you have a COI on hand, then it reaffirms their trust in you and your business.

You will attract more clients.

Trust goes a long way. When you earn the trust of your current clients by producing a COI, they are more likely to recommend you to other, future, potential clients. You and your business will be well-known for being trustworthy and authentic.

Your clients will not only trust you, but they will also be comforted in the knowledge that they are not at risk for any potential liabilities. Most, if not all, clients do not want to assume the risk of financially being responsible for any workplace accidents or mishaps. They want to make sure that you will take responsibility for what is rightfully yours to handle, and then they can do the same.

You will have protection and peace of mind.

A COI protects not only your clients, but also you and your business along with anyone who works for you. Chances are that you will not be working alone on projects, so you will also need to ask those you work with (such as subcontractors) for their own COIs. It is always important, even if you have worked with subcontractors before, to ask for a COI. If they tell you that they are covered, and it turns out their policy is expired, then you could be sued for any damages that happen.

Let’s say, for example, that you hire a subcontractor who accidentally breaks something on your client’s property, resulting in a substantial amount of damage. Without proper insurance or a COI, you could be at risk to cover all of the damages resulting from that subcontractor’s mistake. If you require a COI upfront, then you will not have to worry about these potential disasters. You will be protected financially, and you will have greater peace of mind knowing that both you and your client are fully protected.

How can I get a COI?

Usually, you will receive a copy of your Certificate of Insurance (COI) when you apply for an insurance policy. If you did not receive one, however, and your policy is still current, then you can contact your insurance company or broker and request a COI. Your insurance company will then fill out a form with the required information.

If, for any reason, you would like to request additional insurance on your policy, you can do so when requesting a COI. Simply inform your insurance agency or broker of what you would like.

It should not cost you anything to get a COI, as long as your policy is current. It may, however, take several days to receive the document if you are requesting changes. If you did not make any changes to your policy, then it should take less than 3-4 days to receive your copy of your COI.

Protection for you, your business, and your clients starts with getting a Certificate of Insurance. It is one of the easiest ways to grow your business’s reputation, increase your number of clients, and set up your future for success.