FREQUENTLY ASKED QUESTIONS - CERTIFICATES OF INSURANCE

GENERAL QUESTIONS

QUESTION: WHAT IS ACORD?
ANSWER:
ACORD stands for Association for Cooperative Operations Research and Development and is the global standards-setting body for the insurance and related financial services industries. ACORD facilitates fast, accurate data exchange, and efficient workflows through the development of electronic standards, standardized forms, and tools to support their use. ACORD members worldwide include hundreds of insurance and reinsurance companies, agents and brokers, software providers, financial services organizations and industry associations. An ACORD Membership provides influence, access and collaboration to the global insurance industry. With a membership, you will interact with standards experts, influence global standards development and collaborate with influencers in the industry.

QUESTION: HOW TO SPOT A FAKE CERTIFICATE OF INSURANCE (COI)?
ANSWER: Even the most trust-worthy business can sometimes pass off a fake certificate. Make sure to identify the following on your COIs:

Find the Acord 25
The most trustworthy insurance agencies utilize the Acord 25 form. Check the bottom left-hand corner of the COI to ensure that the certificate says “Acord 25.”

Verify there is a Legitimate Company Attached
Always verify the insurance company on the certificate. Either contact your insurance agent to request confirmation or visit a site like Ambest.com to look up the insurance company in question. If neither confirms the existence of the insurance company – it is likely fraud.

Identify handwriting/mismatching fonts
Examine the policy’s effective and expiration dates and description of operations section. Make sure the information is aligned properly and typed in uniform font. If you notice any handwritten dates or font that does not match the rest on the form, it could be fraudulent.

Look for Generic forms
Multiple sites on the internet hold fake COI documents that people attempt to pass off as valid. Look for a rectangle in the bottom right corner that is blank or says CLEAR ALL. If you see it, the COI was created via a PDF filler application or another tool – likely a fraud.

QUESTION: WHAT IS THE BEST WAY OF TRACKING COI (CERTIFICATES OF INSURANCE)?
ANSWER: Certificate of Insurance tracking software is the best solution for tracking COI because it is automated and requires no human intervention.

QUESTION: HOW DOES COI (CERTIFICATES OF INSURANCE) TRACKING WORK?
ANSWER:
A Certificate of insurance is requested and tracked by the certificate holder (insurance requester) or a third party vendor engaged by the certificate holder to manage the process as comprehensive insurance knowledge is required.

QUESTION: WHAT IS THE BEST SOFTWARE FOR MANAGING CERTIFICATES OF INSURANCE?
ANSWER:
Because of insurance complexity modern-day software designed to ensure the COI meets the insurance requirements is mandatory. There are several cloud comprehensive SaaS offerings ranging from do-it-yourself to third-party management solutions.

QUESTION: HOW TO GET A CERTIFICATE OF INSURANCE?
ANSWER:
Brokers and insurers issue certificates of insurance on a regular basis as the demand is frequent.

QUESTION: WHO GETS A CERTIFICATE OF INSURANCE?
ANSWER:
Certificate holders typically ask for a certificate of insurance for purposes of limiting risk resulting from an uninsured tenant, contractor or vendor.

QUESTION: WHAT IS THE DIFFERENCE BETWEEN A CERTIFICATE OF INSURANCE AND EVIDENCE OF INSURANCE?
ANSWER: Evidence of insurance is an actual insurance policy which is a contractual obligation between an insurer and insured. A certificate of insurance is simply proof of insurance with no coverage descriptions.

QUESTION: WHAT IS A COI USED FOR?
ANSWER:
A COI is used for proof of insurance as it provides insurance policy information to confirm your business is adequately insured.

QUESTION: DOES A COI COST MONEY?
ANSWER:
Not normally as your insurance broker typically provides the form to their insureds as a service. There are some instances where you may be charged for a certificate of insurance.

QUESTION: HOW DOES A COI WORK?
ANSWER:
It is typically issued on a standard form provided licensed by ACORD.org although many insurers provide proof of insurance in various summary formats.

QUESTION: WHAT IS A COI NUMBER?
ANSWER: 
A Certificates of insurance COI typically does not have a number but is identified by a date and the issuer, usually the insurance broker or the insurance carrier.

QUESTION: WHAT IS A SAMPLE COI?
ANSWER:
It is typically issued on a standard format provided by ACORD.org and can be found searching for “Accord 25” to see a sample.

QUESTION: WHAT DOES A CERTIFICATE OF INSURANCE INCLUDE?
ANSWER:
A certificate of insurance basically summarizes insurance coverage which includes policy numbers, date ranges, coverages and coverage limits. It also includes broker and insurer information, who the named insured is and also the party who requested the certificate of insurance (COI).

QUESTION: WHY DO I NEED A CERTIFICATE OF INSURANCE FROM A VENDOR?
ANSWER:
Why do I need a certificate of insurance from a vendor? When employing a subcontractor, it is critical to insulate oneself from exposure to a risk caused by a contractor by ensuring there is alternate insurance with adequate coverages and limits to provide protection. This form of risk transfer is often required by your insurer to reduce their exposure by demanding additional insurance. In addition to a certificate of insurance and additional insured endorsement is another common method of protection.

QUESTION: WHO IS THE CARRIER ON A CERTIFICATE OF INSURANCE?
ANSWER:
Who is the carrier on a certificate of insurance? There could be multiple carriers on a certificate of insurance because a certificate confirms multiple insurance coverages with policies issued by different carriers on a single certificate for each coverage confirmation.

QUESTION: WHY DO I NEED A CERTIFICATE OF INSURANCE?
ANSWER:
Why do I need a certificate of insurance? To protect yourself against acts committed by others that you may employ or on your premise s it is common to ask for a certificate of insurance proving that your vendors and contractors are adequately covered. Also a certificate of insurance for subcontractors is almost always required when being employed by public entities, corporations and clients to limit risk for the certificate holder.

QUESTION: WHAT IS THE DIFFERENCE BETWEEN AN INSURANCE CERTIFICATE AND AN INSURANCE POLICY?
ANSWER:
Insurance policies are actually contracts between the insurer and the named insured outlining the coverages and conditions of the policy. A certificate of insurance identifies a policy is in existence, insured name, line of businesses and coverage, date in force and sometimes comments regarding the policies. The certificate does not include the details of any endorsements or policy language clarifying coverages.

QUESTION: WHAT IS A CERTIFICATE HOLDER ON A COI (CERTIFICATE OF INSURANCE)?
ANSWER:
The certificate holder is the employer or landlord that has requested a certificate of insurance from a contractor, vendor, or tenant depending on the insurance requirements verified on a COI.

QUESTION: IS THERE A BETTER WAY OF TRACKING CERTIFICATE OF INSURANCE THAN EXCEL SPREADSHEETS?
ANSWER:
Certificate of insurance tracking and management software is becoming very popular as compliance is becoming a normal requirement when managing risk transfer. The better products offer document management and ease-of-use at various costs depending on depth and features offered.

QUESTION: WHAT IS A CERTIFICATE OF INSURANCE FOR VENDORS OR CONTRACTORS?
ANSWER:
A certificate of insurance for a vendor is a confirmation statement of insurance coverage as requested by the certificate holder.

QUESTION: HOW TO VERIFY A CERTIFICATE OF INSURANCE?
ANSWER:
A certificate of insurance can be verified by calling the broker or insurer and referencing the policy number. This is a critical component when receiving a certificate of insurance as there is typically no requirement to notify the certificate holder of termination. Verifying certificates of insurance is a primary responsibility of the certificate holder.

QUESTION: WILL THIS PRODUCT WORK WITH A SMALL BUSINESS?
ANSWER: CTrax is beneficial to any company or person needing to process, store, and track COIs. This can be applied in numerous situations e.g., tracking the entertainment’s insurance coverage at a child’s birthday party (to ensure that they’re covered in the event of an accident), or for a large business conference that requires participants to be named as additional insured. Whatever the event, or reason, CTrax is able to help capture all of the relevant information in an easily accessible streamlined workflow.

QUESTION: CAN A CONDO ASSOCIATION USE THIS TOOL?
ANSWER: CTrax is beneficial to any company, or person who uses subcontractors, requires a Certificate of Insurance, or needs to track insurance liability.

TECHNICAL QUESTIONS

QUESTION: ONCE I’VE SIGNED UP, WHAT ARE THE FIRST STEPS TO UPLOADING DOCUMENTS IN THE C TRAX LIBRARY?
ANSWER: The easiest way for new users to upload certificates into the library is to use the intuitive drag-and-drop method. This is done by selecting ‘Admin’ on the left-side menu and then choosing ‘COI COI Import’. The ‘Drag-and-Drop’ option will then be visible for users to use, enabling the system to do the rest of the work.

QUESTION: CAN I UPLOAD MULTIPLE CERTIFICATES AT A TIME?
ANSWER: Yes, batch processing is a common practice that is routinely used by our customers.

QUESTION: HOW LONG DOES THE OCR PROCESS TAKE TO READ PDFS?
ANSWER: Typically, the upload process takes around 1 to 2 minutes for each COI. However, the OCR system was developed with defined parameters that are responsible for accurately distinguishing between text, dates, and numbers. If an uploaded COI possesses a different format related to these data requirements, the certificate will require manual verification. Our verification department will then confirm the status of the COI and return it for the customer’s use within 24 hours. For convenience, the status of each COI will be displayed as ‘Complete’ or ‘Processing’.

QUESTION: DOES THIS PRODUCT MITIGATE RISK?
ANSWER: CTrax provides comprehensive risk transfer information. In doing so, it allows for our customers to conveniently view all relevant data regarding their insurance inquiries. This permits our clients to accurately determine risk transfer liability and establish each carrier’s proper responsibility in an efficient manner that dramatically reduces the chance of human error.

QUESTION: WILL CTRAX AUTOMATICALLY EMAIL MY VENDOR TO RENEW THEIR CERTIFICATE OF INSURANCE?
ANSWER: Yes, the solution is easily configured by the user to automate most of the processes involved with tracking COIs as based on predefined parameters.

QUESTION: DOES CTRAX PROVIDE REMINDERS FOR EXPIRING CERTIFICATES OF INSURANCE?
ANSWER: Yes, the program is easily configured by users to provide reminders at predetermined intervals. Reminders are usually set at 30 to 60 days prior to a certificate’s expiration.

QUESTION: HOW CAN I ENSURE THAT ALL OF MY CERTIFICATES ARE ALWAYS UP TO DATE?
ANSWER: CTrax verifies compliance based on both user preferences, and what the vendors have submitted. If the certificate does not meet these parameters, it creates a warning for the user to complete further investigation into the matter. The CTrax homepage (Dashboard) provides a convenient access point to all of the critical information within the solution, so that users can quickly determine their needs at a glance.

QUESTION: IS CTRAX LIMITED BY THE TYPES OF PROVIDERS IT CAN ACCEPT INTO THE SYSTEM?
ANSWER: No, users can quickly add any provider into the system for complete comprehensive coverage. The program also comes equipped with templates for commonly used provider types, permitting multiple providers to be added at the same time.

QUESTION: DOES CTRAX WORK IN CONJUNCTION WITH ANY ADDITIONAL FORMS?
ANSWER: Users are able to upload any relevant information that they deem important into the CTrax library, from there the system can be configured to recognize specific key words within these documents. However, CTrax is specifically designed to read and manage COI 25 forms and works best under these conditions.