Certificate of Insurance (COI): Do You Need It?

certificate of insurance coi

Sometimes, the thought of dealing with more paperwork can seem like an uphill struggle – especially when you need multiple documents for everything you can think of (plus the restroom sink)! Then, just when you think it’s all sorted, there’s another to consider…

A certificate of insurance is a really important piece in the business jigsaw. Having this document can mean the difference between offering security and assurances to new clients – or losing business because you can’t prove your credentials. 

What is a certificate of insurance (CoI) and do you need it? 

What is a Certificate of Insurance? 

A certificate of insurance is a single document, issued by your insurance broker that basically holds all the key points of any coverage your business has, in one easy-to-read document. This means that potential (and current) clients and partners can see at a glance if you have the requisite cover needed to operate your company safely. 

You need it to prove your insurance status and protect yourself against insurance claims. They’re needed for most types of businesses – or basically, any working situation where loss or liability could occur.

Why is a Certificate of Insurance required?

Certificates of insurance are essential for every business owner to protect them from the following four issues. 

Firstly, they prove your insurance status to potential and continuing clients. 

Secondly, they give a bitesize overview of what you are and aren’t covered for – so people who are considering working with you can see at a glance what your status is. 

Thirdly, a certificate of insurance offers a reduction in liability  – so in the event that an accident or injury occurs, the bulk of the loss goes to the other party’s insurer. 

Fourthly and finally, these certificates provide cover when you outsource work to other people. 

When should someone ask to see a Certificate of Insurance? 

You should always ask to see a certificate of insurance when a client, a contractor, or a vendor will carry out work or undertake tasks that increases your risk of liability in the event an accident occurs.

Liability includes risks that are related to injury and death on a job, damage to property and equipment, or the completion of work that is deemed to be substandard or dangerous. 

Who issues a Certificate of Insurance? 

They’re issued on behalf of the business by an insurance company – or in the event it’s requested by a client or someone else you’re working with.

They’ll be sent a copy document to view and this provides them with proof that you’re insured as you say you are.

This also applies when a contractor requests you provide proof of insurance – in this case, the certificate of insurance is provided directly to the client.


In short, as important as being insured for every eventuality is, it’s also important that you can prove you are to anyone who asks in the course of the day-to-day running of a business.

A certificate of insurance is a necessary document to have on file and keep updated (usually it runs for five years) if you want to keep your business running as securely as possible.  

Gretchen Walker
Gretchen is a homemaker by day and writer by night. She takes a keen interest in life as it unfolds around her and spends her free time observing people go about their everyday affairs.