A certificate of insurance is a one-page summary evidencing that a party holds coverage: the insurer, the policy type, the limits and the dates.
Why a business collects them
From subcontractors, so their work is covered by their insurance rather than falling to the engaging business.
For customers, who frequently require evidence before awarding work.
What to actually check
The dates. A certificate collected once and never re-checked lapses silently, and the lapse is discovered at a claim. Tracking expiry and requesting the renewal is the whole of the control.
The limits, against what the contract requires.
The coverage types, including workers compensation. A subcontractor without it is frequently treated as the engaging business's employee at a premium audit, and charged accordingly.
The named insured matching the entity actually doing the work, which is not always the trading name on the invoice.
Additional insured
Being named on someone else's policy, so a claim arising from their work can be made against their insurer directly rather than only against them.
A certificate alone does not create this. It requires an endorsement to the underlying policy, and asking for the endorsement rather than the certificate is the difference between protection and paperwork.
Waiver of subrogation
A term preventing the insurer, having paid a claim, from pursuing the other party to recover it. Commonly required in commercial contracts, and it must be arranged on the policy in advance.
Occurrence and claims-made
An occurrence policy covers incidents that happened while it was in force, whenever the claim arrives.
A claims-made policy covers claims made while it is in force, which means letting it lapse can leave past work uncovered.
The distinction matters most for professional liability, and it is worth knowing which one the business holds — see business insurance.
Aggregate limits
The most a policy pays across a whole period, as distinct from per claim. An earlier claim can exhaust it, leaving less cover than the certificate implies for the rest of the term.