Got a Customer Asking for a Certificate of Insurance? Here's What to Do

What is a COI?

A certificate of insurance is a one-page document that proves you have insurance coverage. It summarizes the important details of your policy so your clients and customers can see that you are appropriately covered with the right insurance to do business with them.

A certificate of insurance is an easy way to demonstrate your proof of coverage. Having a single document to present to a potential customer is simpler than providing someone with a multi-page insurance contract.

What’s in a COI?

A certificate of insurance includes all the information necessary to confirm proof of coverage, including:

The insured’s business and mailing address

• Type of business
• Type of coverage
• Coverage limits
• Additional insured(s)
• Policy effective date and expiration date
• Contact information for the insurance company

As the insured business owner and the person who purchased the policy from an insurance provider, you are the policyholder.

The customer or entity that requests a certificate of insurance is the certificate holder. They receive a COI from a policyholder as proof of insurance.

Why Your Customer is Asking for a COI

You’re so close to landing a new project, and your potential customer just requested a certificate of insurance.

Is this a good thing?

Yes. Most likely, they’re asking for all the right reasons. A COI request usually happens when two parties agree to work together. You won’t find many customers or clients eager to work with a company that’s uninsured or unwilling to provide a COI. Here’s what’s happening:

They want to do business with you.

If you made it this far, it’s a good sign. The request for a COI is not unusual and means the customer is interested in your business and wants to verify your credentials.

Your ability to provide them with proof of insurance will give both of you peace of mind before working together.

They want to know you have the right coverage.

Your customer wants to ensure you have proper insurance coverage to protect against certain financial risks associated with the work. The certificate of insurance states the policy or policies you carry so your customer can see if you have sufficient coverage. If you don’t, they may request that you get it.

They want to confirm your policy is up to date.

A certificate of insurance includes essential information that customers are seeking. They will be able to check that the name of your business matches the policy. And they can see the expiration date — so they’ll know if your company will be covered for the duration of your business agreement.

They have questions about additional insured.

An additional insured endorsement is a provision for a commercial general liability policy that extends certain rights under the policy to others, such as the right to make a claim. If your business involves subcontractors, your customer will want to know if they are covered under your policy. The covered individuals are listed on the certificate of liability insurance.

Why You Should Have a Certificate of Insurance

If you already have business insurance, obtaining a COI is one extra step you can take to help your business run smoothly.

Here are a few reasons why you should always have this document on hand.

1. It proves you have coverage.

Most companies and clients will ask you to provide a COI before signing a business contract. If something goes wrong, they want to know that you’re covered for any loss you may cause. If you’re insured, you can quickly provide them with the documentation they need to feel confident about hiring you.

2. It gives you a competitive advantage.

Bidding work means competing against companies that may be uninsured and charging lower rates. When you submit your COI along with your bid, your potential customer has proof that you’re insured and protected. It demonstrates that you’re an experienced professional who runs a reputable business.

3, You're renting a business space.

Renting or leasing a space for your business is another instance where you’ll need to provide a COI. Many landlords and property owners will ask for a certificate of insurance to ensure your business is covered for lost or stolen equipment, accidents, and other risks.

4. You’re applying for financial assistance.

If you’re a business owner applying for a grant or loan, be ready to share your certificate of liability insurance. When an organization makes a financial investment in your company, they want to know that you have insurance to cover claims or legal fees if your business is sued.

Why You Might Ask Someone for a COI

For business owners, insurance coverage should always be top of mind. Protecting yourself and others from property damage, bodily injury, and more is vital for your company's well-being.

If your business involves working alongside others, you may be the one to request a certificate of liability insurance.

Let’s say you’re a caterer who works with numerous vendors. You don’t want to be held responsible for any of their mistakes that could result in property damage, loss, or bodily injuries. So you’re going to want what others want from you — proof of insurance coverage.

You should ask them for evidence of insurance coverage via a COI. Double-check the details to ensure they are correct and up to date. You also can contact the insurance agent listed on the COI to verify the information.

Don’t Have a COI? Here’s How to Get One

If you already have an insurance policy for your business, it’s fairly easy to get a certificate of insurance.

Call your insurance provider or log into your account to request one, and you’ll be sent a COI that reflects the details of your current policy. It’s a good idea to keep a digital copy on hand, as well as a hard copy, so you can quickly respond to a request for either.

There may be times when you’ll need to determine whether your current insurance coverage meets the requirements of a potential job. In that case, it’s always best to review your coverage before requesting the COI.

You can follow these steps to ensure the process is as smooth as possible:

Step 1: Check your policy.

In most cases, the business insurance you already have will meet your potential customers’ requirements. But before you request your COI, double-check your coverage just in case.

Start with the person requesting the COI. Ask what the minimums and limits of the coverage should be. Gather the customer’s information, including their name, address, and tax identification number.

Step 2: Contact your insurance company.

Call your insurance provider and inform them of the minimum coverage amount so they can check if your policy meets the requirements.

• If it does, your provider can begin to process your certificate of insurance.
• If it doesn’t, you’ll need to purchase a policy rider to increase coverage to meet the work requirements. Your insurance provider can guide you through the process.

Step 3: Obtain your COI.

Once you’re confident that you have the proper insurance, your provider will create the COI and send it to you. It’s your responsibility to send the certificate of insurance to your customer so you can finalize your contract and begin the work.

How Long Does it Take to Get a COI?

It all depends on the status of your insurance coverage.

When you have insurance coverage. If you already have an active policy and don’t need additional coverage, it should take only a few days to get a COI. Once you contact your provider, they will create the certificate and send it to you.

If you need to update an existing policy, the process may take several days or weeks, depending on your provider and the extent of your policy changes.

When you don’t have coverage. In this case, the first step is to find an insurance policy that fits your business’s needs.

Begin by thinking about the risks you encounter every day and the potential for accidents or injury. Then consider the different types of insurance coverages you may need or want to include in your business insurance.

We make it easy at Simply Business with our free quote comparison tool.

For small businesses, general liability coverage is a great place to start. It can go a long way toward protecting your business by covering the costs related to claims of:

• Third-party bodily injury
• Third-party property damage
• Personal and advertising injury
• Claims arising from product defects
• Medical expenses
• And more

Without general liability coverage, the cost of claims like these could come out of your pocket.

So how much insurance do you need? Obviously enough to keep you well protected. It’s an important part of your business plan, so you should factor it into your budget.

Insurance premiums are typically paid on a monthly or annual basis. The cost of your premium will vary, depending on where you work, the type of work you do, your years of experience, and other factors.

At Simply Business, we work with many of the nation’s top insurers, so we can find affordable coverage to fit your budget. That includes general liability policies as low as $22.50 per month.*

We also have licensed insurance agents who can answer questions and take care of your coverage on the phone. Just call 844-654-7272, Monday - Friday, 8am - 8pm (ET)

Once you have your business insurance in place, getting a certificate of liability insurance takes only a day or two, and there’s no additional cost to you. A certificate of insurance is included when you purchase an insurance policy.

At Simply Business, you can obtain your COI by logging on to your customer account and downloading it, requesting it here, or by calling your licensed insurance agent at 844-654-7272. Simply request a certificate of insurance, and it will be sent to you.

You Got This

It may sound like a tall order, but getting a certificate of liability insurance doesn’t involve a lot of work — especially if you already have comprehensive insurance coverage. With a current certificate of insurance on hand, your business will run more efficiently — and you’ll make it easier for customers to hire you.

* Monthly payment calculations (i) do not include initial premium down payment and (ii) may vary by state, insurance provider, and nature of your business. Averages based on January - December 2020 data of 10% of our total policies sold.