Avoiding Certificate of Insurance E&O: Part 2

Brenda is a Senior Solutions Specialist at ReSource Pro with over 35 years of experience in the insurance industry.

Certificates of insurance are more than an entry-level task

Insurance agencies often view certificate of insurance requests as a simple, entry-level task that can be used as a training ground for new staff. But between reviewing requirements and contracts and accurately evaluating whether coverage is appropriate, certificates are complicated. When handled poorly, they can lead to frustrated insureds, lost accounts, and even E&O claims against the agency.

In part one, we shared several E&O prevention best practices that agencies can apply prior to binding coverage. In this post, we’ll discuss what agencies can do to protect themselves during certificate issuance.

E&O prevention when issuing certificates

Certificates of insurance are a moment of truth for insureds. By applying the best practices below, agencies can continue to deliver the high level of customer experience their insureds expect.

  • Avoid paraphrasing or explaining policy language. When issuing certificates, do not add anything that implies or suggests coverage not explicitly granted by the policies. Do not state that coverage satisfies the requirements of a particular contract. And do not state that contractual liability coverage applies to a particular contract. Instead, attach the policy forms and use statements like: “Certificate holder has additional insured status to the extent provided on the attached form(s).”
  • Attach complete policy forms (with insured’s permission). Policy forms should be attached to certificates so that certificate holders can make their own judgement about coverage. Ensure the entire form is attached, as some forms give coverage on one page but later remove it in the definitions or exclusions sections.
  • Send copies of certificates to insurers for review. It is a best practice to send copies of certificates to the insurer, although some insurers may prefer not to receive them.
  • Reflect the limits of the policy. While you do not have to include all layers of umbrella that have been placed, you should include the appropriate limit of the policy that is shown on the certificate.
  • Understand the laws. Research the laws of the states where the insured is located and where they do business. You can look at the states’ Department of Insurance website to get this information.
  • Determine procedures around pending cancellations. Agencies handle certificates on policies with pending cancellations in different ways. Some options include not issuing certificates until payment is made, issuing certificates as requested because the policy is not yet canceled, or noting the pending cancellation date in the description of operations.
  • Use the appropriate ACORD form. We often see agencies use the same ACORD form for every certificate. Instead, ensure you are using the correct form as outlined in the ACORD Form Instruction Guide (FIG). Also note the edition dates.

Don’t choose between E&O risk and agency growth

When tasked to entry-level staff, certificate requests can raise an agency’s risk of E&O. But when tasked to experienced account managers, they take time away from other activities that could grow the business. Your agency shouldn’t need to choose between one or the other.

ReSource Pro’s Certs Center helps alleviate the burden of certificate management and issuance on your agency by quickly handling certificate requests throughout the day. With best-in-class accuracy and a 2-hour average turnaround time for rush requests, we help you drive high levels of customer service and minimize E&O while providing you with enhanced reporting around your certificate production.

You’ll benefit from:

  • Rapid, accurate certificates. Our certs-specific teams are on hand throughout your working day to ensure an average of 2-hour turnaround times for rush requests.
  • Minimized E&O risk. To offer complete peace of mind to agencies, we include enhanced indemnification along with our standardized processes to limit E&O risk.
  • Maximum capacity lift. We provide an end-to-end, turnkey solution from request receipt through to successful issuance, without the need for request forms or triaging.
  • Service and process insights. Our proprietary task management and tracking cloud-based system allows for unrivalled insight into your certificate management and issuance operations.

Visit our Certs Center page to learn more.