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If you run a business or you are a contractor, there is a high possibility that you know what a certificate of insurance is. As a contractor, you have possibly been asked to provide one to someone for whom you have done work. A certificate of insurance is proof that you have the correct insurance in place for the work that you are hired to complete. In fact, it can be a huge benefit when you are looking for work. If you want to know more about the certificate of insurance and what the benefits of showing this document to your clients are, then keep reading below:
What is a Certificate of Insurance?
A certificate of insurance (COI) is not an actual insurance policy, and it is not something that businesses have to pay for. It is merely a document that proves that you have the correct insurance in place. It usually shows the type of cover your business has and what your liability limits are.
What is the Purpose of a Certificate of Insurance?
A certificate of insurance is an extremely important document. It acts as the insured’s proof to contractors, customers, and any other interested parties that a business has the correct insurance in place. It also shows that the company has the financial capital to protect individuals who may be injured through their own carelessness.
The certificate of insurance is usually less weighty than an insurance policy and can be created more efficiently and quickly. It works in a similar way to how a driver’s proof of insurance aids a victim of a car crash whose car has been harmed – it shows that an insurance company has issued a document stating that there is a policy that may protect them against loss.
What are the Benefits of Showing Your Clients Your Certificate of Insurance?
Almost all customers like to see a certificate of insurance before working with a company. They want to know and make sure that you have the correct insurance in place so that they are not liable in the event of a claim. A certificate of insurance can positively impact your business in several ways including:
- Demonstrates responsibility – showing your clients your certificate of insurance indicates to clients that you are willing to assume responsibility should an accident occur on the job. Not only does it show them that you want to protect your business, but it also shows them that you have their best interests at heart.
- Shows your company is established – protecting your business implies that you intend to be in business for a long time to come. This will show prospective customers and others that you are not prepared to risk a claim being made against your company that could threaten the future of your business. This helps to reinforce trust with your customers, and it can help your business to be taken more seriously. If customers like your products and services and trust you, they will be more likely to recommend your company to others and give you repeat custom.
- Increase Customer Contracts – showing your customers your certificate of insurance will help them to see that you are doing everything you can to prevent a claim. This may lead to them thinking you have superior safety standards than businesses that do not have this policy visible or available for their customers. This builds trust with your customers, which can ultimately lead to new business opportunities.
How to Get a Certificate of Insurance
Lots of businesses find it hard to manage and keep track of their certificates of insurance. It can take a lot of money and time which are two things that you do not have when you are running a business. However, there is another option. The Next Insurance Live certificate is an easy way for people to share proof of their insurance and the best news is, it is totally online. You simply need to be a Next Insurance customer to access your certificate of insurance.
No matter what type of business you own or run, every type of business needs the financial and legal protection of insurance coverage suitable to their personnel, structure, equipment, service, and products. For most businesses, the capacity to show an insurance certificate as verification that they have insurance is crucial. In fact, the certificate can be nearly as valuable as the coverage itself.