A certificate of insurance is proof that a business has liability insurance. It's a good idea to have it on hand in case a client asks for it. A certificate of insurance (COI) typically includes the following information:
- The name of the insurance company and policy number.
- The policyholder's name.
- The policy effective date.
- The policy expiration date.
- The coverage type (for example, business liability insurance).
- The policy limits (the dollar amount of much coverage you have, such as $1 million).
Do you need a certificate of insurance?
A potential client might ask for a certificate of liability insurance before giving you a job. It shows your client that you have enough coverage to cover accidents you're responsible for, like property damage or injuries.
If your business provides a service where a customer or another business could be harmed, it's a good idea to have a certificate of insurance ready and available. For example, you may be a general contractor who is hired to build an addition on a home, a landscape architect hired to design and plan a garden layout, or a computer technician hired to install a network in an office.
Likewise, if you hire a business to do work for your company, like a subcontractor, you may want to ask to see their certificate of insurance. Even if you worked with them before, it's good practice to ask each time you hire someone in order to to verify their insurance policy has not expired. Check for the following:
- The name of the person/company you're hiring matches the name on the certificate of insurance.
- They have sufficient coverage limits for potential problems with the job.
- The insurance has not expired.
How to get a certificate of insurance
Contact your insurance company to get a certificate if you don't have it already. If you're buying liability insurance, you can often get a certificate of insurance form online and have proof the same day.