Most commercial property managers have a COI collection process. Almost none have a COI verification process. Collecting a certificate and verifying it meets the lease are two completely different activities-and the gap between them is where the $500,000+ uninsured incidents happen.
Here's the scenario: your lease requires $2 million per occurrence in general liability. Your tenant's COI shows $1 million. You collected the COI. You filed the COI. An incident occurs, damages are $1.4 million, and your tenant's coverage pays $1 million. The remaining $400,000 comes from your property insurer-which then threatens non-renewal and raises your premium by $18,000 annually for three years.
This guide walks through a step-by-step verification process that catches gaps before incidents do.
Step 1: Extract Insurance Requirements from the Lease
Before you can verify anything, you need a complete list of what your lease actually requires. This sounds obvious-it isn't. Most leases spread insurance requirements across multiple sections:
- The primary insurance clause (typically Article 12, 13, or 14 in standard commercial leases)
- The additional insured clause (often a separate subsection)
- The indemnification section (which may reference insurance)
- Any lease amendments or riders that modified original requirements
Pull every insurance requirement and list them explicitly:
- Coverage types required
- Per-occurrence and aggregate minimums for each
- Additional insured language and specifics
- Waiver of subrogation requirements
- Notification requirements for policy changes
- Any project-specific or tenant-type-specific requirements
Step 2: Collect the COI and Accompanying Endorsements
Request the tenant's ACORD 25 certificate-and explicitly request the additional insured and waiver of subrogation endorsements as separate attached pages. Most brokers will send just the one-page ACORD form unless you ask for endorsements.
A COI that states "Additional Insured: [Your Entity]" in the description box without an attached endorsement is unverified. The certificate is a summary document. The endorsement is what creates the legal relationship.
Step 3: Verify the Named Insured
Confirm the entity name on the COI exactly matches the legal name of the tenant in your lease. Common mismatches:
| Lease Entity | COI Shows | Issue |
|---|---|---|
| Greenfield Retail Partners LLC | Greenfield Retail | Abbreviated-may not match legally |
| Smith & Associates Inc. | Smith and Associates | Formatting difference-verify with broker |
| Metro Dining Group LLC | Metro Dining | Missing entity designator |
| Cornerstone Medical PC | Cornerstone Medical Group | Different entity entirely |
When in doubt, call the insurer with the policy number and confirm the named insured.
Step 4: Compare Coverage Limits Line by Line
This is the verification step most property managers skip. Open the lease requirements list alongside the COI and compare each item:
General Liability Check:
- Lease: $2,000,000 per occurrence / $4,000,000 aggregate
- COI: $1,000,000 per occurrence / $2,000,000 aggregate
- Result: Non-compliant on both lines
Workers' Compensation Check:
- Lease: Statutory limits
- COI: "Statutory" checked; employers' liability $500K each accident
- Result: Compliant (if $500K meets lease requirement)
Umbrella/Excess Check:
- Lease: $3,000,000 following form
- COI: $3,000,000 umbrella; does not specify what policies it follows
- Result: Needs clarification-request endorsement schedule
Document every finding, compliant or not.
Step 5: Verify the Additional Insured Endorsement
The additional insured verification is the most important and most frequently failed step:
- The COI should reference a specific endorsement (CG 20 10, CG 20 11, or equivalent)
- The attached endorsement should name your exact legal entity
- The endorsement should specify "primary and non-contributory" if required by your lease
- Verify whether the endorsement covers only ongoing operations (CG 20 10) or also completed operations (CG 20 11)-your lease likely requires both
For completed operations coverage: this matters especially for tenant improvement projects. If a tenant builds out their space and a defect causes damage two years after project completion, you want completed operations coverage in force.
Step 6: Verify Waiver of Subrogation
Check the COI for waiver of subrogation on:
- Commercial General Liability
- Workers' Compensation
- Property (if applicable)
The waiver on the COI must be confirmed by an attached endorsement, not just a checked box on the ACORD form. An insurer who checks the box but hasn't issued the endorsement may still subrogate.
Step 7: Confirm Policy Expiration and Active Status
The COI shows an expiration date. That date tells you when the certificate was valid as of issuance-not necessarily that the policy is still in force today. Policies can be canceled mid-term for non-payment, material misrepresentation, or underwriting reasons.
For any tenant with a claim history, high-risk operations, or recent business changes, verify active policy status directly with the insurer by calling with the policy number.
Step 8: Document and Communicate Results
After completing your review:
If compliant: Log the COI, the verification date, and the next renewal date. Set a calendar trigger to request an updated COI 45 days before expiration.
If non-compliant: Send a written deficiency notice to the tenant listing each specific gap, citing the lease clause, and requesting a corrected certificate within 5 business days. Do not accept verbal assurances.
Template deficiency notice language:
"Pursuant to Section 14.3 of your lease dated [date], your current certificate of insurance is deficient in the following respects: [list each gap]. Please provide a corrected certificate addressing each item within five (5) business days. Failure to maintain required insurance is a material breach of your lease."
How Long Does Manual Verification Take?
For a single tenant: 30-45 minutes if done carefully.
For a 50-tenant office building with annual renewals: 25-37 hours per year of pure verification time, before deficiency follow-ups, re-reviews, and documentation. At $35/hour fully loaded, that's $875-$1,295 in labor per building per year-just for the initial review, not the ongoing management.
For a portfolio of 10 buildings: $8,750-$12,950 annually in direct labor for verification alone. The industry estimate for total manual COI management cost is $36,400 per year across a mid-size portfolio.
Frequently Asked Questions
Q: What if the tenant's policy is written on a non-standard form? A: Some carriers use proprietary policy forms rather than ISO standard forms. Non-standard forms may or may not provide equivalent coverage. Request the actual policy form and have it reviewed by your insurance advisor before accepting it.
Q: Can we require tenants to use carriers above a certain AM Best rating? A: Yes, and you should. A minimum of A- AM Best rating is standard in most commercial leases. Carriers below that threshold have higher insolvency risk, meaning coverage may not be available when you need it.
Q: What happens to our additional insured status if the tenant goes out of business? A: It terminates with the policy. If a claim arises after the tenant closes, and the policy has lapsed, there may be no coverage. This is why completed operations coverage matters for tenant improvement projects.
Q: Is there liability for the property manager personally if they fail to verify? A: Potentially. In some states, property managers have been named individually in litigation alleging negligent failure to enforce lease requirements. Proper verification protects both the property owner and the manager.
Bramble eliminates manual verification entirely. Upload your lease, submit the COI, and get a clause-by-clause compliance report in seconds-not 45 minutes. Every gap identified, every finding documented, every renewal tracked automatically.