Do you ask for and receive all the certificates of insurance you need?
General contractors collect insurance certificates as a standard operating procedure. Every subcontractor provides a certificate or they don't walk onto the jobsite.
But what about other operations?
Fundamentally, a certificate of insurance is a standard form that offers proof of insurance for workers' compensation, general liability, automobile liability, or any coverage a recipient requires.
The certificate outlines the coverage, the policy limits, and whether the recipient is included or excluded under the contractor's policy. This process clarifies which entity provides insurance for specific operations and which entities are insured under the policy.
Outsourcing is another word for subcontracting. Payroll or staffing professionals provide services to many businesses; if you use those services you should require a certificate of insurance. If an injury occurs while someone is performing assigned tasks and the vendor is not insured for workers' compensation, your company can end up filling that coverage gap.
For practical guidance about certificates, classification, and audit exposure, see Certificates of insurance, independent contractor classification, and workers' compensation audits.
An electrician wiring a new outlet in your office should provide a certificate before starting work.
A coffee service employee who injures their back while stocking supplies can create a claim that affects your company unless you have proof of their coverage.
Any entity providing services on your premises should offer proof of workers' compensation and general liability insurance at a minimum. For more on how workers' compensation applies in service relationships, see Independent Living Facilities Workers' Compensation.
Insurers have increased attention on outsourced and specialist services as sources of additional premium and audit exposure. What used to be a contractor audit issue for construction firms is now relevant to manufacturers, offices, and many mainstream businesses.
Go through your suppliers, groundskeepers, window washers, temporary labor providers, and other outsourced service personnel and ask for current certificates of insurance that show workers' compensation and general liability coverage.
If you're unsure what to request or how to verify a certificate, talk to your insurance agent by choosing to ask your agent before the vendor begins work.
Frequently Asked Questions
Who should provide a certificate of insurance?
Any third-party individual or company that performs work on your premises or for your business should provide a certificate showing workers' compensation and general liability coverage.
What should I check on a certificate?
Confirm the coverage types, policy limits, policy effective dates, and whether your company is listed as an additional insured when required.
Can a certificate be relied on indefinitely?
No. Certificates can expire or be canceled, so verify dates and request updated certificates for ongoing vendors.
What if a vendor refuses to provide a certificate?
Consider restricting their access to your premises or require proof of coverage through contract language before work begins.