When contracting with a vendor, property occupant, supplier or sub contractor, it is important to ensure that they maintain the proper insurance coverage that meets your specific insurance requirements. A certificate of insurance is one of the documents that provides proof of the presence of insurance coverage, including details on the insurer, type of coverage, its limits and the policy stipulations. It is also important for a business to have a certificate of insurance tracking system where it manages their incoming certificates to facilitate an effective certificate of insurance tracking methodology.

A proper certificate of insurance management system monitors insurance compliance and provides the tools to help reduce the complexity and time spent on certificate of insurance tracking.

Amongst many benefits you receive from tracking vendor certificates of insurance, the right certificate of insurance management system can detect deficiencies made on the received certificate of insurance and prevent that certificate from being accepted when it is non compliant. As well, this system should be able to communicate what those deficiencies are back to the insured so that a compliant certificate can be re-submitted. Ultimately, by having a proper system in place for tracking vendor insurance compliance, you are avoiding future risks and potential claims that may result from engaging with these parties.

Quick tips to help you with vendor compliance:

• Verify vendors understand the insurance requirements in the contract before signing. Require an affidavit be signed confirming they understand the insurance requirements being requested before signing the contract.
• Provide clear examples and instructions for certificate of insurance submission.
• Encourage vendors to consult with insurance agent prior to signing contract.
• Incorporate a no tolerance policy.