Who Needs A Certificate of Insurance

Who, when and why you should ask for insurance certificates....

Who Needs to Have a Certificate of Insurance:

On this page we are going to explain just why you may need to ask someone for an insurance certificate for workers compensation.

The Insurance Certificate is an informational piece of paper that consumes a great deal of time in the insurance world. It seems as though everyone is asking someone for proof of insurance. But what's really behind this, just why do some need to have a certificate, who are these people and do you need to ask for an insurance certificate from someone you conduct business with?

The Insurance Certificate is written proof that workers compensation coverage is being provided for a certain group of workers. You must understand that the certificate is used by a broad spectrum of people for a variety of reasons. From a workers compensation stand point, it is used to provide proof that a workers compensation policy is in place.

Typically, if you enter into any type of contract where the contracting company is attempting to shift liability to your business for work you are going to perform then you will be asked to supply proof of insurance coverage. In the below list we've outlined a few of the reasons why and who may need to secure a certificate. Keep in mind this is not an all inclusive list but just a starting point.



A list of those who may require a Certificate of Insurance for workers compensation:

Those who enter into a contract - If a contract requires that certain limits of coverage be provided then a certificate will be required by the contracting company to provide proof that coverage exists. Those who hire another firm to do work - A workers comp basic...when you hire anyone else to perform work on your behalf, expect that you are responsible for the workers compensation coverage for those other workers. So anyone who hires another firm will want to make sure there is a workers compensation policy in place for those workers. This is accomplished by asking for an Insurance Certificate. Contractors using subcontractors - When any contractor hires another contracting firm to complete work for them then a certificate will be required to provide assurance that workers compensation coverage is in place on the subcontractor. General Contractors, Developers, Project Owners - Typically these types of entities will require anyone performing work on a job on which they are either developing, acting as the general contractor or own to provide them with insurance certificates that show workers compensation coverage in place. Governmental Entities - Cities, Counties, State Departments and other governmental entities who have work performed for them will probably have some sort of contract in place in which they will list out the insurance requirements. One of the requirements will no doubt be that those performing work for them will have to provide workers comp coverage and provide a certificate of insurance as proof of coverage. You Do - If you plan to hire a contractor or any other business to provide a service for your business. Remember that in most states your company will be next in line to handle a workers compensation claim and provide workers comp coverage for the workers of the company you hire if they do not have, or may have had workers comp insurance but has since lapsed.

Will asking and securing a properly executed insurance certificate guarantee that you have protected your company from the unknown workers compensation claim? No. But it certainly is a step in the right direction.

So as you can see, many different entities may have the need to ask for and receive an insurance certificate for a variety of reasons. At some point in time you may find that you and your company may actually have a need to ask for a certificate.

Follow the link at the top of this page for our next topic about Insurance Certificates.

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