Certificate of Insurance in Construction: How to Read a COI
A certificate of insurance in construction is a one-page summary, issued by a contractor’s insurance agent, showing which policies the contractor carries, the limits, and the dates those policies are in effect. Builders collect one from every trade before work starts. The catch is that a certificate is a snapshot for information only. It doesn’t change the policy, it doesn’t guarantee coverage for a given claim, and it can be out of date the day after it’s issued.
So you need to know how to read one, and you need to know what it can’t tell you. A folder full of certificates nobody looked at is decoration.
What is a certificate of insurance for contractors?
It’s proof, in summary form, that a contractor had certain insurance policies in place on the date the certificate was issued. You’ll hear it called a COI, or a certificate of liability insurance in construction, since liability coverage is the main thing it reports. It’s prepared by the contractor’s insurance agent or broker, usually on a standard industry form, and sent to whoever asks for it.
That “whoever asks” is the certificate holder. On your jobs, that’s you.
What does a certificate of insurance include?
Most certificates follow the same layout. Reading top to bottom, here’s what each part tells you:
Date issued. When the certificate was produced. Old dates deserve a fresh request.
Producer. The insurance agency that issued it, with contact information. This is who you call to verify.
Insured. The legal name and address of the contractor. It should match the name on their agreement and W-9.
Insurers. The insurance companies behind each policy, lettered so you can match them to the coverage lines below.
Coverages. The main grid. Each row is a type of policy: general liability, automobile liability, umbrella or excess, workers’ compensation, and sometimes others.
Policy numbers and dates. An effective date and an expiration date for each policy.
Limits. The dollar limits for each coverage, such as per occurrence and aggregate.
Additional insured and subrogation columns. Small boxes indicating whether the policy includes additional insured status or a waiver of subrogation.
Description of operations. A free-text box where the agent adds notes: the project, who is an additional insured, special wording.
Certificate holder. Your company name and address.
Cancellation and signature. A statement about notice of cancellation and the agent’s signature.
How do you read a COI step by step?
Read it against your own requirements, not on its own. Have the insurance section of your agreement next to you and go down the list.
Check the name. If the insured name doesn’t match the company you’re contracting with, you may be looking at coverage for a different entity.
Check the dates. Is every policy current? Will it stay current through the work? Note the earliest expiration date in your tracking log.
Check the coverage lines. Is every policy you require actually listed? A blank workers’ comp row is an answer.
Check the limits. Compare them with what your agreement calls for. Your agent helped you set those numbers. Use them.
Check the additional insured boxes and the description box. Then ask for the actual endorsement. More on that below.
Check the certificate holder. Your correct legal name should be there.
Check the source. It should arrive from the agency. If something looks edited, call the producer and confirm.
What you’re checking against matters as much as the checking. If you haven’t set those yet, start with subcontractor insurance requirements.
What does a certificate of insurance cover, and what doesn’t it?
Strictly speaking, a certificate doesn’t cover anything. The policies do. The certificate only reports that they exist. That distinction is where builders get hurt.
Here’s what a certificate won’t tell you:
The exclusions. A policy can exclude residential work, certain project types, or specific operations, and none of that appears on the certificate.
Whether you’re truly an additional insured. That status comes from an endorsement to the policy. A checked box or a typed note is a claim that the endorsement exists. Ask for the endorsement itself.
Whether the policy is still active. Policies can be cancelled for non-payment after the certificate goes out. Don’t count on getting a notice.
How much limit is left. An aggregate limit can be eaten up by other claims during the policy year.
For the trades that carry the most risk, ask your insurance agent to review the endorsements, and the policy where needed. Agents do this all the time, and it’s a much better use of their expertise than yours.
What mistakes do builders make with certificates of insurance?
Filing without reading. The most common one by a mile.
Collecting once. A certificate from onboarding three years ago tells you nothing about today.
Confusing certificate holder with additional insured. Holder status means you get a copy. It gives you no rights under the policy.
Accepting a copy from the trade. Get it from the agent. It takes them five minutes.
Not tying it to payment. Without consequences, renewals arrive whenever, which means never.
Skipping the veterans. The trade you’ve used for a decade is the one whose certificate nobody has checked in a decade.
How do you manage certificates across all your trades?
Use a simple log and a firm rule. The log lists every trade, every policy, and every expiration date. Someone reviews it monthly and requests renewals before they lapse. The rule is that accounts payable doesn’t release a check to a trade with a missing or expired certificate.
The requirement itself belongs in your subcontractor agreement, and the certificate sits alongside the W-9, lien waivers, and the rest of the subcontractor paperwork checklist. If you’d like that set up as one system, that’s what our Subcontractor Paperwork Package is for.
Frequently asked questions
Who issues a certificate of insurance?
The contractor’s insurance agent or broker issues it, usually at no charge to the contractor. Request that it be sent to you directly from the agency.
Is a certificate of insurance the same as an insurance policy?
No. It’s a summary of policies that existed on the date it was issued. The policy and its endorsements control what’s actually covered.
How long is a certificate of insurance good for?
Only until the earliest policy expiration date shown on it, and only if the policies stay in force. Get a new certificate at every renewal.
Does being the certificate holder make me an additional insured?
No. Additional insured status requires an endorsement to the contractor’s policy. Ask for a copy of that endorsement and have your agent confirm it meets your requirements.
BTW, if you want certificates, agreements, and the rest of your trade partner paperwork handled as one system, grab our Subcontractor Paperwork Package over at the Building Optimal Shop, where you can check out the rest of our swag to build a better business. Proceeds go to benefit, Exponencialistas, my non-profit investing in entrepreneurs transforming their communities in Latin America.