Tips for Certificate of Insurance Management Process for Sub-Contractors/Independent Contractors
February 25, 2021
Tips for Certificate of Insurance Management Process for Sub-Contractors/Independent Contractors

A certificate of insurance is a snapshot of an insurance program for your business summarizing the coverage dates, carrier(s), policy type(s) and limits for liability policies. They can include wording for special conditions like an additional insured or a waiver of subrogation. Collecting, reviewing, and tracking these documents is an important step in the risk management of an organization. 


Here are some tips for your Certificate of Insurance (COI) management process for sub-contractors:


Use a vetted written agreement with your sub-contractors.

If you’re getting a certificate of insurance from a sub-contractor naming you as an additional insured most of the insurance carriers’ forms require that a written agreement be on file and the additional insured status will only apply within the letter of the contract.


Know what your sub-contract agreement says about insurance requirements and make sure that they are being met.

Are you requiring minimum limits of coverage? Most agents recommend that you require limits equal to or greater than yours. Make sure that the certificates  provided meet the requirements in your contract.


Always request a new certificate of insurance for every new job unless you have a current one on file.

Some policy dates may not run congruently for all lines of coverage. Have some sort of reminder to get a new one on file prior to making a payment to the sub-contractor.


If you are requesting that they add your organization as an additional insured, make sure that the additional insured form is attached to the certificate.

Some policies have to be specifically endorsed and some policies include a blanket additional insured endorsement on the policy. The form will tell you the terms and conditions and limitations that apply to you as an additional insured.


Not collecting certificates of insurance or using uninsured sub-contractors will cost you money at audit time.

Under a general liability policy an “uninsured sub” will be included in your liability rating and for worker’s compensation they will be classed in their appropriate worker’s comp class and charged for at your audit.


Click here to see how the DOL defines Independent Contractors. 


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