What is a Certificate of Insurance (COI)?

Certificate of Insurance

What is a Certificate of Insurance?

All small business owners, startups, independent contractors, and entrepreneurs need business insurance to protect their financials, businesses and professions from potential liability risks. But how do you know you’re insured when you’re forging new partnerships or signing contracts with a new customer? The answer is simple: you need a Certificate of Liability Insurance. 

What is a Certificate of Insurance? A certificate of insurance (or COI) is a one-page document (digital/physical) that summarizes a business’s liability coverage. It’s often referred to as an identification card, but it’s much more than that.

Why do you need COI?

The main reasons why a COI is necessary are as follows: 

> It protects you from liability if you are faced with an accident, injury, theft, or if someone has caused damage to property. 
> It gives you an edge over the competition since clients want to minimize their risk and work with such business owners or contractors.  
> It allows you to avoid having to pay higher on worker’s compensation and general liability premium when an audit takes place. 
> It ensures that your organization is fairly compensated if a contractor doesn’t deliver or delivers poor work. 
> It makes it easy for you to work with clients and grow your business with them. 
> If you don’t have a COI when you buy a new vehicle, you could end up paying higher premiums. 
> It serves as evidence of insurance if you get stopped by the police.

What types of businesses need a Certificate of Insurance (COI)?

It really depends on your and your client’s needs. Generally speaking, any small business/independent professional that provides a service with the risk of liability losses may be required to provide a Certificate of Insurance. If you’re an independent contractor, caterer, accountant, or other professional who manages finances for another business or individual, it makes sense that you’d want a COI to provide upon request to any partners or customers. 

If you request a third-party COI from a brokerage, you’ll want to make sure that all the information is accurate and that the policy is valid.

How to get a COI from your insurance provider?

First, you need to iron out the details of your coverage with your client (name, address, tax identification number, etc.). This will give you the information you need to ask for an increase in premium. Then, you need to talk to your broker about the situation and explain to them the minimum amount of coverage you need. If your policy meets the requirements, your broker can contact your insurance provider right away to secure a COI. In cases where a rider needs to be added to your coverage to increase the COI, your broker can provide you with all the paperwork you need to make the claim. 

Once you have all the details sorted out, your broker can draft your COI and mail it to you (physical or electronic). You can then send a copy of the COI to your client. 


A Certificate of Insurance (COI) is an important form of insurance for any company or organization. It demonstrates that the policyholder is financially protected in the case of an accident, or any other event that would otherwise result in a loss of income. It is important to have a licensed insurance broker to act as your trusted advisor to review your liability risks, recommend ways to improve your coverage if needed, and reduce your liability risks. 

Choose the right insurance company that will be with you at every step, whether you need to change insurance in the middle of a policy, or you just need to request a Certificate of Insurance. Akan insurance works with you to find the right coverage you need from our partner networks of insurance providers and customize the policy to meet your needs.

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