What are Certificates of Insurance and Why Do You Need Them?

If you’re a small business owner, such as a contractor, most potential clients will ask to see your proof of insurance before hiring you. Your insurer or insurance agent should typically be able to provide these documents if your policy is active.

However, how do insurance certificates work, what are they, and who needs them? Equally important, why are COIs essential to small businesses and how can you securely generate and deliver these documents on demand? Read on for a full explanation.

What are Certificates of Insurance?

A COI serves as proof that you have active and up-to-date business insurance. The standard document highlights critical details of your insurance policy, such as type of coverage and policy limits. It also includes your name as the policyholder and the policy effective date.

The Importance of Certificates of Insurance

You can win important contracts by presenting a COI to show that your business has sufficient insurance coverage. Your clients, such as landlords or vendors, may request the document before they will agree to do business with your company.

Once a client has received your COI, they’ll scrutinize it for evidence that you have sufficient liability protection. The document can provide a reasonable degree of assurance that the client isn’t assuming any risk in case you’re liable for property damage, workplace injury, or other losses or damages. Without a COI, you may find it more difficult to earn the trust of prospective customers or clients.

How to Generate Certificates of Insurance

Most insurance companies or agents offer an online tool that policyholders can access to quickly generate COIs. Such a platform lets you produce and send a COI to the requester on demand, no matter your physical location. The specific process of generating a COI may vary from provider to provider, but it generally involves the following steps:

  1. A potential client or customer requests proof of business insurance.
  2. Log in to your business insurance account with your provider or agent.
  3. Access the COI generator.
  4. Enter your business information.
  5. Provide the client’s details. The potential client is the certificate holder.
  6. Click generate to produce your proof of insurance.
  7. Download and send the COI to the requesting entity.

Fortunately, you don’t need to manually type your insurance policy details each time you want to generate a COI. The system automatically updates all your certificates to provide the most recent and accurate information about your coverage levels, policy limits, and other details of interest to potential clients. For example, if you recently expanded your liability coverage or added a couple of endorsements, the COI you generate will convey that information.

Online COI Management

With online COI management, you can view all the certificates you created in the past as many times as necessary. You may also download digital copies of COIs for particular requesters at any time.

The ability to generate insurance certificates on-demand increases your chances of winning contracts. Contact the experts at Pittman Insurance Group, LLC for all your coverage needs. Our dedicated team is eager to assist with all your insurance questions and needs.

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