What is a certificate of insurance?A Guide for Home Inspectors

Quick Summary: A certificate of insurance (COI) is a document that proves a home inspector carries active insurance coverage. It typically includes key details like coverage types, policy limits, and the certificate holder, serving as a condensed, shareable version of your full insurance policy. Most insurers provide COIs automatically at binding or renewal, and they can issue updated versions upon request at no additional cost. 

Pretend you’re a home inspector who has just been asked to inspect a newly built, single-family home. As you prepare for the inspection, you get an email from the builder requesting that you send them a copy of your certificate of insurance.

You may wonder: What is a certificate of insurance and what does it cover? Does it cost money? Is it hard to get? Does sharing my proof of insurance with the builder put me at risk?

Here at InspectorPro, we get those questions all the time. We figure it’s time to walk you through certificates of insurance 101 so you’ll never need to ask “what is a certificate of insurance” again. Better yet, you’ll be prepared anytime a builder or client requests one.

What is a certificate of insurance?

Section Summary: A certificate of insurance (COI) is a condensed summary of your active coverage. The purpose of a certificate of insurance is to act as proof of insurance for third parties.

Also known as proof of insurance (POI), a certificate of insurance (COI) is a written document that proves you currently carry insurance.

To define certificate of insurance simply: It’s a condensed summary of your active coverage. The purpose of a certificate of insurance is to demonstrate to a third party—like a builder, real estate agent, or commercial client—that you carry sufficient coverage to respond to claims or damages. Often these third parties need to verify your insurance coverage certificate as evidence of insurance before allowing you onto a property.

Understanding the certificate of insurance’s meaning is straightforward once you’ve seen one. A COI document pulls key details from your full policy into a single, easy-to-read page. Think of it as your insurance policy certificate in miniature.

What does a certificate of insurance include?

Section Summary: A standard COI form includes insured information, coverage types, limits, and certificate holders.

While not all COIs look the same, most standard COI forms contain similar information, including:

• Your name and address.
• Your business or DBA name and address.
• A simple breakdown of your coverage and limits (i.e., $1,000,000 of commercial general liability or errors and omissions coverage).
• The names of employees covered under the policy.
• The certificate holder or entity to whom you’re providing the certificate.

What does a certificate of insurance look like in practice? Here is a certificate of insurance example:

Is a COI the same as a declaration page?

Section Summary: Declarations pages are policy summaries for insureds while certificates of insurance are condensed coverage highlights for others.

Not quite. Your declarations page, or dec page, is your complete internal policy summary. It includes pricing, detailed exclusions, and other private information.

While your declarations are meant for you, a certificate of business insurance is meant for others. It’s condensed into a simpler format with less information than you would find in your full policy documents for insurance, both for convenience and privacy.

Think of the dec page as your full report card and the insurance certificate as a highlights summary you hand to a coach.

When is a certificate of insurance needed?

Section Summary: Home inspectors need certificates of insurance when builders, agents, franchisors, or large commercial clients request them to do business.

Knowing when home inspectors need to provide a certificate of insurance is essential for staying compliant and winning new clients.

When a client wants to confirm that you have the insurance coverage to respond to any claims or damages caused by your inspection, they will ask for a certificate of insurance. It will often be builders, real estate agents, franchisors, and larger commercial clients who need COIs before you can inspect a property. State governments may also require proof of insurance to verify you meet the minimum insurance requirements before you can get your license as a home inspector.

When you are inspecting a new build, for example, the builders are concerned that you’ll break or cause damage to their newly finished property. So, they want to make sure you can cover anything that you break with commercial general liability insurance. (If you’re curious about the top five general liability claims against home inspectors, read here).

For commercial clients, they may wish to see proof of errors and omissions (E&O) insurance to cover any issues that you may have missed, since commercial inspection mistakes can lead to large claims. After all, the claimant may drag your client into the claim due to your alleged negligence.

If clients are particularly concerned about being named in claims for your alleged mistakes or accidents, they may go a step beyond asking for a certificate of insurance and request you add them as an additional insured to your policy. An additional insured certificate of insurance allows your policy to cover them. For more information on additional insured endorsements, read our certificate holder vs. additional insured article.

If your client hasn’t requested a certificate of insurance, do you need to send one?

Section Summary: Inspectors shouldn’t give others COIs unless they request them.

No. In fact, if they haven’t asked for it and you send one anyway, you may introduce the idea of getting reimbursed for any issues they find, which can lead to unnecessary claims.

How do I get a certificate of insurance for my inspection business?

Section Summary: To obtain a certificate of insurance, extract the copy from your current policy or request a new one from your insurer.

While it may feel like your clients are asking you to jump through hoops for a company certificate of insurance, many insurers make the process simple. In fact, most providers send a copy of your business insurance certificate when you bind coverage or renew your policy. If you save that copy, it’s often sufficient for clients as your standard COI certification.

Alternatively, if clients request an additional change, such as their name in the certificate holder space, or that you add them as an additional insured, or any other special wording, just contact your insurance provider. Your broker and their account manager deal with many requests for certificates of insurance throughout the day. So even if you don’t understand the specifics of your clients’ demands, your provider can help clarify and send the certificate of insurance with any needed changes.

When you request a certificate of insurance, give your insurance provider the following COI information:

• Your name.
• The name of the client (i.e., the builder).
• The client’s office address.
• Any special instructions.

Then, your provider will confirm you’re carrying sufficient coverage to meet your client’s COI requirements and send you the certificate of insurance. 

If your client is requesting different coverage or greater insurance limits than you currently have, your provider can help you. This may mean you need to increase your coverage, even mid-policy, to meet their requirements. Simple, right?

Your insurer can only write insurance certs showing coverage that they provide for you. This means that you may need to request multiple COIs in cases where the client requests proof of insurance documents for multiple coverage types that you carry through multiple insurers.

Be prepared when a client requires proof.

Section Summary: InspectorPro provides certificates of insurance quickly and can answer COI-related questions.

A request for a certificate of insurance from a client is not something to stress out about. Or, it doesn’t have to be if you carry the correct coverage and have an insurer who prioritizes client support. At InspectorPro, we’re proud to provide quick responses to COI requests and education about every aspect of your certificates of insurance.

If you would like an experienced home inspector insurance provider to have your back, contact us for a quote. We look forward to helping you jump through as many hoops as you need to so that you can become a successful inspection business.

More Frequently Asked Questions

What is proof of insurance?

Proof of insurance is documentation that confirms you hold an active insurance policy. A certificate of insurance (COI) is the most common form of a proof of insurance document used in the home inspection industry.

What does COI stand for in insurance?

COI stands for certificate of insurance. It may also be called an insurance certificate, a commercial certificate of insurance, or a certificate of liability insurance.

What is a certificate of liability insurance form?

A certificate of liability insurance form is a standardized document summarizing your coverage, including policy limits, effective dates, and certificate holders. The ACORD 25 form is the most widely recognized standard COI in the industry.

How long is a certificate of insurance valid?

A COI is typically valid for the policy period listed on the document—usually one year. Once the policy expires or is cancelled, the certificate is no longer valid. Your insurer will issue a new one upon renewal.

What is the cost of a COI?

Requesting a certificate of insurance itself is typically free since it’s simply a document reflecting coverage you already pay for. However, adding an additional insured or making other policy changes could affect your premium. Speak with your broker for specifics.

Do home inspectors need a certificate of insurance?

Yes, in most cases. Builders, real estate agents, and commercial clients commonly require a certificate of insurance before allowing an inspector onto a property. Some states also mandate proof of insurance as part of the licensing process.