Certificate of insurance

Two parties sit on either side of a certificate of insurance. One is the certificate holder, the person or business that asks to see evidence of coverage. The other is the insurer whose policy the certificate describes, and Florida gives that insurer a duty to verify it on request.

The duty is short enough to quote whole. Florida Statutes 624.447, which carries the title "Certificate of insurance for contractors," provides: "Any insurer shall, upon request, verify a certificate of insurance on any contractor, as defined in s. 768.0425." The statute uses the term without defining it; it takes the paper as given and sets the rule for checking it.

For a contractor within the definition 624.447 points to, whether a certificate is current and matches a policy is a question for the insurer named on it, which the statute obliges to verify when asked.

The verification duty in 624.447 does not reach every business. It points to one definition, in Florida Statutes 768.0425(1), and that definition carries its own limit in its first words: "For purposes of this section only."

Within that section, a contractor is "any person who contracts to perform any construction or building service which is regulated by any state or local law, including, but not limited to, chapters 489 and 633." Chapter 489 is the state's construction contracting chapter, described in Chapter 489 of the Florida Statutes, defined. The definition turns on regulated construction or building service, not on a trade name.

Neither section names a trade beyond the two chapters, and neither says a contractor must hand a certificate to anyone: 624.447 puts its duty on the insurer.

The everyday sense of the term comes from the Florida Department of Financial Services, in two documents written for two different readers.

The first is a consumer guide on preventing contractor fraud and abuse, published by Florida's Insurance Consumer Advocate together with the American Property Casualty Insurance Association. The two describe working together "to spot and stop contractor fraud and abuse, especially after a disaster", and the guide is quoted here in that context. Its instruction is plain: "Verify that the contractor has general liability insurance by requesting a Certificate of Insurance." Among its warning signs is a contractor who is "not willing to provide you with evidence of their Certificates of Insurance for General Liability" and for workers' compensation.

The second is the Division of Workers' Compensation's employer FAQ, written for businesses rather than homeowners. Describing how a contractor can confirm that a subcontractor has workers' compensation coverage, it names, as one way to do that, "A Certificate of Liability Insurance and written documentation obtained either from the producer or carrier" confirming that the coverage is in effect.

A certificate of insurance is not the same paper as a business tax receipt, which Florida Statutes 205.022(8) describes as evidence of compliance with the business tax provisions of Chapter 205; the difference is set out in what a business tax receipt shows about an exterior cleaner. On a tile roof, TRI Alliance's safety recommendation also mentions insurance, and it is set out with roof safety and the tile warranty.