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Certificates of Insurance with ‘Additional Insured’ status: Why we ask about contracts.

Nov 13 2018

A standard certificate of Insurance is a snap shot in time. It tells a certificate holder how much insurance coverage an insured has in place, the effective dates of the policies, and the name of the insurance carrier. Requesting a standard certificate is straight forward and quick for an agent to process.

However, when a certificate holder requests to be added to your policy as an “Additional Insured”, this requires insurance agents to ask about and understand if there are contractual obligations that need to be met. Here’s why!

‘Additional Insured’ status requires a attention to detail

As the world has gotten more litigious, contract requirements and language have become more complex. Providing a certificate holder with ‘Additional Insured’ status means that they receive many of the same benefits as you under your policy. As a result, insurance companies have gotten stricter about agents reviewing contracts to ensure that the coverage in place matches what is required in that contract. In fact, many carriers have changed their ‘blanket additional insured endorsements’ to provide coverage only when there is a written contract in place. If you don’t have a contract, ‘Additional Insured’ status can still be provided, but it may require an additional endorsement for that instance. For this reason, Murphy Insurance asks about contracts and request that insureds send a copy of the contract or at least the Indemnity and Insurance Provisions section so that our Associates can review the information confirm that current coverage meets contractual requirements. It’s another way that we are looking out for your best interests.

How providing contracts can help you

A good contract defines the scope of work, budget, schedule, and governs all parties’ obligations in the event of a loss. A well-drafted insurance requirement provision can help decrease the risk associated with a particular project, or shift the consequences of that risk to another party. However, if you are not careful, contract language can extend your liability exposure beyond the scope of work you are doing. This is another reason that insurance carriers have become more stringent.

For example, a plumber was entering into a contract requiring ‘Additional Insured’ status. Upon closer review by our team it was discovered that the contract language was requiring him to cover liability associated not only with his work but also the work of the builders and architects should anything go wrong on the project. By showing us the contract before he signed, the plumber was able to get it amended prior to the start of the job. While you are ultimately responsible for the contracts you sign, your insurance agent may be able to help identify potential problem situations.

How to request Certificates of Insurance at Murphy Insurance

There are a couple ways you can request a Certificate of Insurance:

Website  -  Under the Resources menu you’ll find “Certificate of Insurance Request”. We provide an online form that prompts you for the information we need to issue a certificate. This can help avoid delays caused by missing information.

Email  -  certificateofinsurance@dfmurphy.com – If you’re familiar with the information needed to issue a certificate, you can email the Murphy Insurance certificate team. Remember to provide:

  • the certificate holder’s full name and address
  • an email and/or fax number where to send the certificate
  • if additional insured status in required, and if so tell us if you have a contract send a copy of at least the insurance requirements section of the contract.         

If you have any questions about the information above or Certificates of Insurance in general, please contact us. We are always glad to assist you.

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