Certificate of Liability Insurance: When Do You Need It? How to Get One? 

Thang Truong
Thang Truong
Updated on:

Liability insurance is an essential part of managing risk for businesses and contractors. In this article, we’ll explore the purpose, benefits, and process of obtaining a certificate of liability insurance. By the end, you’ll have a thorough understanding of this critical document and its importance in protecting your business.

What is a Certificate of Liability Insurance (COI)?

A certificate of liability insurance (COI) is a document that serves as proof that a business or contractor has an active liability insurance policy in place. This policy provides coverage for claims arising from personal injury, property damage, and other liabilities related to the insured’s operations.

Purpose and function of a COI

The primary purpose of a COI is to demonstrate to clients, partners, and regulatory authorities that a business or contractor has the necessary insurance coverage. It helps build trust and credibility, as well as ensures compliance with industry standards and legal requirements.

Key components in a COI

A COI typically includes the following information:

  1. Name and contact information of the insured party
  2. Name and contact information of the insurance provider
  3. Policy number
  4. Coverage limits
  5. Policy effective dates

When do you need a Certificate of Liability Insurance (COI)?

There are several circumstances that you need to have your business’s COI or you are requested to show it to your clients or customers. 

For businesses and contractors

Regardless of the industry, most businesses and contractors should have liability insurance. It’s especially crucial for those who provide services or work in environments where accidents or damages are more likely to occur.

Specific industries and professions

Some industries and professions where liability insurance is particularly important include:


In the construction industry, there’s a high risk of accidents, property damage, and injuries due to the nature of the work. A COI demonstrates that a contractor or construction company has adequate insurance coverage in case of incidents such as:

  1. Injuries to workers or third parties on the construction site
  2. Damage to a client’s property during construction or renovation
  3. Faulty workmanship or materials leading to property damage or financial losses


Healthcare professionals and facilities face numerous liability risks due to the sensitive and high-stakes nature of their work. A COI is essential for:

  1. Malpractice claims arising from alleged medical errors, negligence, or misdiagnosis
  2. Accidents or injuries occurring on healthcare facility premises, such as slip and fall incidents
  3. Patient privacy breaches or violations of healthcare regulations


Consultants provide expert advice and services, which can expose them to liability risks if their recommendations result in negative outcomes for clients. A COI is important for:

  1. Claims of negligence or errors in professional judgment
  2. Breach of contract or failure to deliver agreed-upon services
  3. Intellectual property disputes, such as copyright or trademark infringement


Manufacturing businesses face a range of potential liabilities related to their products and operations. A COI is essential to address:

  1. Product liability claims due to manufacturing defects, design flaws, or inadequate safety warnings
  2. Workplace accidents or injuries sustained by employees during manufacturing processes
  3. Environmental damage or pollution resulting from manufacturing activities


Retail businesses interact with a large volume of customers and can face various liability risks. A COI is necessary for:

  1. Customer injuries or accidents occurring on the business premises, such as slip and fall incidents
  2. Claims related to selling defective or dangerous products that cause harm to consumers
  3. Employee injuries or accidents occurring in the course of their work at the retail location

In each of these industries, a COI not only helps protect businesses from potentially significant financial losses but also helps build trust with clients, partners, and regulatory authorities.

In many cases, businesses and contractors are legally required to have liability insurance to operate. Furthermore, clients may require a COI as part of their contracts to ensure that the service provider is adequately insured.

What does a Certificate of Liability Insurance contain?

Insured party information

This section includes the name, address, and contact information of the insured party (i.e., the business or contractor).

Insurance provider details

The name, address, and contact information of the insurance provider issuing the policy are also included in the COI.

Policy coverage limits

The COI outlines the maximum amount the insurance company will pay for each type of covered claim. These limits can vary depending on the policy and the insured’s needs.

Policy effective dates

The policy’s start and end dates are listed on the COI, which indicates the period during which the insurance coverage is valid.

Additional insured and endorsements

If any additional parties are covered by the policy or if there are any specific endorsements or exclusions, they will be mentioned on the COI.

How to get a Certificate of Liability Insurance (COI)

The process of getting a COI depends if you already have a liability insurance policy in place: 

Scenario 1: Requesting a COI when you already have a liability insurance policy

If you already have an active liability insurance policy in place, obtaining a COI is typically a simple process. Follow these steps:

  1. Contact your insurance provider: Reach out to the company that issued your liability insurance policy and request a COI. Provide any necessary information, such as your policy number, to help the provider locate your account.
  2. Specify requirements: If your client or partner has specific requirements for the COI, such as adding them as an additional insured or including specific endorsements, make sure to communicate these to your insurance provider.
  3. Receive your COI: Once your insurance provider has processed your request, they will issue the COI, usually in digital or printed format. The delivery method may vary, so be sure to clarify with your provider how you will receive the certificate.
  4. Share the COI with relevant parties: After obtaining the COI, share it with your client, partner, or any other party that requires proof of your liability insurance coverage.

Scenario 2: Requesting a COI when you don’t have an active liability insurance policy yet

If you don’t currently have a liability insurance policy, you’ll need to go through the process of obtaining one before you can request a COI. Here are the steps:

  1. Research insurance providers: Start by researching and comparing insurance providers that specialize in your industry or profession. Look for a provider with a strong reputation and competitive rates.
  2. Understand your business’s specific needs: Analyze your business’s potential risks and liabilities to determine the appropriate coverage limits and ensure you are adequately protected.
  3. Gather necessary documentation: When applying for liability insurance, you’ll need to provide information about your business, such as its legal structure, location, and operations. You may also need to submit financial records and other relevant documents.
  4. Complete the application process: Choose an insurance provider and complete the application process, providing all requested information and documentation. Be honest and thorough in your responses to ensure you receive the appropriate coverage.
  5. Receive your policy and COI: Once your application is approved, you will be issued a liability insurance policy. At this point, you can request a COI from your insurance provider. They will issue the certificate based on the details of your policy.
  6. Share the COI with relevant parties: With the COI in hand, share it with your client, partner, or any other party that requires proof of your liability insurance coverage.

In both scenarios, it’s crucial to keep your liability insurance policy and COI up to date and to inform your insurance provider of any significant changes to your business that may affect your coverage.

Liability insurance types for small businesses

Liability insurance for small businesses is a type of insurance policy designed to protect small business owners and their operations from financial losses resulting from claims made against them due to incidents involving third parties. These claims may arise from bodily injury, property damage, or personal and advertising injury that occur during the course of business operations.

Small business liability insurance typically includes the following coverage types:

  1. General Liability Insurance: General liability insurance covers claims related to bodily injury, property damage, and personal and advertising injury that may arise from the business’s operations or products. It can help pay for medical expenses, legal fees, and damages if the business is found to be at fault.
  2. Professional Liability Insurance: Also known as errors and omissions (E&O) insurance, professional liability insurance is designed to protect businesses that provide professional services, such as consultants, accountants, or lawyers. This coverage helps protect against claims of negligence, errors, or omissions in the provision of professional services.
  3. Product Liability Insurance: For businesses that manufacture, distribute, or sell products, product liability insurance is crucial. This coverage protects against claims of injury or damage resulting from defects, design flaws, or inadequate warnings related to the products.
  4. Workers’ Compensation Insurance: This insurance is required in most states and provides coverage for employees who experience work-related injuries or illnesses. Workers’ compensation insurance helps pay for medical expenses, lost wages, and rehabilitation costs, as well as providing financial support in case of permanent disability or death.
  5. Cyber Liability Insurance: With the increasing reliance on technology and the internet, businesses face risks related to data breaches and cyber-attacks. Cyber liability insurance helps cover the costs associated with responding to a breach, including legal fees, public relations efforts, and notifications to affected individuals.
  6. Employment Practices Liability Insurance (EPLI): EPLI coverage protects businesses from claims related to employment practices, such as wrongful termination, discrimination, or harassment.

The specific liability insurance coverage a small business requires depends on the nature of its operations, industry, and potential risks. It’s essential for small business owners to carefully assess their needs and consult with insurance professionals to ensure they have the appropriate protection in place.

Differences between general and professional liability insurance

General liability insurance covers claims related to bodily injury, property damage, and personal injury, while professional liability insurance (also known as errors and omissions insurance) covers claims related to negligence, errors, or omissions in the provision of professional services.

Other considerations for your liability insurance policy 

Renewal and updating process

Liability insurance policies typically need to be renewed annually. It’s crucial to keep your coverage up to date and to inform your insurance provider of any significant changes to your business that may affect your policy.

International considerations

If your business operates internationally or provides services to clients in other countries, you may need to obtain additional coverage or endorsements to ensure you’re adequately protected. Consult with your insurance provider to discuss your specific needs.


Understanding the importance of a certificate of liability insurance is crucial for businesses and contractors across various industries. By staying informed and ensuring compliance with liability insurance requirements, you can protect your business, build trust with clients, and maintain your professional reputation. Remember to periodically review and update your policy to make sure it continues to meet your evolving needs.

Thang Truong
Thang Truong

Thang Truong covers small business insurance and small business success at BravoPolicy. He is a licensed P&C insurance agent. Previously, he held product leadership positions at realtor.com, Capital One, NerdWallet, and Mulberry Technology. He holds a MBA degree from UC Berkeley - Haas School of Business.

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