Verifying a contractor's insurance involves three things: confirming the COI is authentic, confirming coverage is current, and confirming coverage meets your contract requirements. Many organizations do the first two and skip the third. The third is where your real exposure lives.
Here's the complete verification protocol.
Step 1: Confirm the Certificate Is Authentic
COI fraud exists. Before relying on a certificate, basic authenticity checks include:
Check the issuing broker. The upper-left section of the ACORD 25 form lists the broker. Search the broker name to confirm they're a legitimate insurance agency. If you've never heard of the broker and the contractor is local, a quick verification is worthwhile.
Check the insurer. Each listed carrier should be:
- A recognizable insurer, or
- Verifiable through your state's Department of Insurance website (all licensed insurers are searchable)
- AM Best rated A- or better if your contract requires it
Look for obvious anomalies. Inconsistent fonts, pixelated text, limits that seem improbably high for the premium being paid, or policy numbers that don't follow normal formatting are all red flags.
When in doubt, call the carrier. If you have a policy number from the certificate, you can call the insurer's policyholder services line to verify the policy is active and the limits are correct. This takes 5-10 minutes and provides real-time confirmation.
Step 2: Verify Coverage Is Current
For each coverage type listed on the ACORD 25:
Check policy dates: The "Policy Eff" (effective) date should be on or before today. The "Policy Exp" (expiration) date should be after today - and ideally more than 30 days out.
Check for gaps: If you're verifying a renewal certificate, confirm there's no gap between the prior policy's expiration and the new policy's effective date. A gap means an uninsured period.
Consider the project timeline: The coverage must be current not just today but through the project's expected completion. A policy expiring in 60 days may need renewal before the project ends.
Step 3: Verify Coverage Meets Your Contract Requirements
This is the substantive verification step. Go through your contract (or your standard insurance requirements) and check each requirement against the certificate:
Contractor Insurance Verification Checklist:
Coverage types:
- Commercial General Liability present
- Workers' Compensation present (if contractor has employees)
- Commercial Auto present (if contractor uses vehicles)
- Umbrella/Excess present (if required)
- Professional Liability present (if required for design or consulting work)
Limits:
- CGL per occurrence limit meets contract minimum
- CGL aggregate limit meets contract minimum
- Auto liability limit meets contract minimum
- Umbrella/Excess limit meets contract minimum
- Workers' Comp is at statutory limits
Endorsements:
- Your legal entity named as Additional Insured (correct entity name)
- Additional insured basis is "primary and non-contributory" if required
- Waiver of subrogation reflected where required by contract
- Cancellation notice period meets contract requirement (30 days if specified)
Product/completed operations:
- Products-completed operations included if required (construction/manufacturing)
Every item in this checklist should be verified against your contract, not against a general sense of what's "adequate." The contract is the standard.
Step 4: Verify Additional Insured Status Specifically
This deserves extra attention because it's frequently wrong.
Where to look: Additional insured designation appears in the "Description of Operations / Locations / Vehicles / Additional Insureds" box on the ACORD 25 form. Not the certificate holder box at the bottom.
What "Additional Insured" looks like in this box: "ABC Property Holdings LLC is named as Additional Insured, Primary and Non-Contributory, on the Commercial General Liability policy per endorsement CG 20 10."
What "certificate holder" looks like: Your name and address are listed at the bottom of the form, in the "Certificate Holder" box. This is a notification, not a coverage right.
Confirm the legal entity name: "ABC Properties" is not the same as "ABC Property Holdings LLC" in an insurance claim. The named entity must match exactly.
For high-stakes relationships: Request a copy of the actual additional insured endorsement form (CG 20 10 for ongoing operations, CG 20 37 for completed operations). The endorsement is the document the insurer will honor; the certificate description is informational.
Step 5: Document Your Verification
After completing verification:
- Record the date you reviewed the COI and what you found
- Note any deficiencies you identified and what remediation was required
- Record the date a compliant COI was received if there was an initial deficiency
- File all documentation with the contract
This audit trail demonstrates your compliance program was functioning if a claim ever requires it.
When to Escalate
Escalate to risk management, legal, or your insurance broker when:
- The contractor's policy appears inadequate for the specific risk being undertaken
- The certificate contains language or endorsements you don't understand
- You suspect fraud or authenticity issues
- The contractor is performing unusually high-risk work and you want independent verification
- A claim is active or anticipated
Related Resources
- How Do I Know If a COI Is Valid
- Who Is Responsible for Verifying Contractor Insurance
- What Insurance Does a Contractor Need
- Difference Between Insured and Additional Insured
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