certificate of insurance

All You Need to Know About a Certificate of Insurance

It might seem like it’s an unnecessary inconvenience – but a certificate of insurance is an essential document that can make the difference between securing new clients for your business or losing them.

If you’re a small business owner or an independent contractor, then ensuring you’ve got the right coverage for yourself – and that you can prove it – will make your day job a whole lot easier. Here’s all you need to know about getting a certificate of insurance. 

Explaining a Certificate of Insurance

What exactly is a certificate of insurance? Well, it’s a document that’s issued by an insurance broker, which proves that you’re insured and entitled to work within your chosen field, safely and securely.

Typically, the document lists the following details: the name of the policyholder, the start date of the policy, what type of coverage you have, and whether or not there are any limits on it. Business owners will need one as it offers protection against liability for any accidents that occur in the workplace.

These types of certificates are needed for almost all businesses in which losses or liability can happen. A company that has to purchase public liability insurance should automatically be issued with one of these as a matter of course.

How does a Certificate of Insurance work?

Certificates of insurance will have different areas on the form for the different types of liability coverage they offer. These usually fall into one of four different areas depending on the nature of your company: 

  • General
  • Auto
  • Umbrella
  • Workers’ compensation

The insurance covers the policyholder, individual, or company listed as being insured by the Certificate of Insurance.

As well as the coverage, the certificate gives personal details of the policyholder, including their name, address, and the type of business they operate. The address of the insurance company or companies is given, too.  If a client requests a certificate of insurance they are then what’s known as a certificate holder. Their name and details will appear on the certificate and they will also have to be notified in the event the policy changes in any way.

How long before a Certificate of Insurance expires?

Once a certificate of insurance has been issued, it will last for five years. It’s worth noting that you should always hold on to all your certificates, even if they’re expired as you may be required to give proof you were insured in the event a problem arises at a later date.

Obtaining a Certificate of Insurance

If you require a certificate of insurance for your business, you should be able to get it directly from your insurance company and have the proof sent to you.

If you’re a client or a contractor and want to obtain one from anyone you’re wanting to engage with for business then you’ll need to speak to find out who they’re insured with and arrange to have the documents sent to you. 

Conclusion

A certificate of insurance is an important and necessary document to have if you want to do business safely and securely – and want clients to trust you. It’s a small price to pay to have peace of mind and know you can prove you’re covered in the event that any accidents or injuries occur. 

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