Certificates of Insurance
PIA supports clear laws and regulations on the appropriate scope, use and issuance of certificates of insurance.
What Is a Certificate of Insurance?
A certificate of insurance is a document issued directly by an insurance carrier or a producer, on behalf of a carrier, to a third party that contains a "snapshot" or summary of the insured's coverage the day of issue. A certificate is not an insurance policy and cannot be used to alter or expand coverage. A certificate confers no rights or benefits upon the third party certificate holder to the underlying insurance policy referenced in the certificate.
Why Are Clear Laws and Regulations Governing Certificates Use and Issuance Important?
Widespread misunderstanding over the proper purpose of certificates has led to producers being asked or pressured to issue certificates that contain language inconsistent with the underlying insurance policy, or that inaccurately suggests the existence of certain contractual rights. Clear laws and regulations enable hardworking agents and brokers to avoid being perceived negatively by their clients when they refuse to issue nonstandard certificates of insurance. Such laws also provide penalties for those who attempt to circumvent the law.
What Is PIA Doing to Support Appropriate Certificate Laws and Regulations?
PIA is committed to working with all interested parties in each jurisdiction to highlight and, if necessary, clarify laws, regulations and practices governing use of certificates. Through a combination of modernizing industry business practice and refining state laws and regulations, PIA is working to provide clarity regarding the proper use of certificates.
PIA worked with the National Conference of Insurance Legislators (NCOIL) to pass a Certificates of Insurance Model Law. Adopted by NCOIL in November 2012, the model law has served as the basis for certificates legislation in numerous states. PIA continues to work with NCOIL and PIA state affiliates to educate state insurance legislators on certificates of insurance issues. A chart summarizing current certificates laws and regulations by state can be found here.
PIA is working with ACORD, a global, nonprofit standards development organization serving the insurance industry and related financial services industries, in an effort to maintain certainty and uniformity of certificates language.
For more information on what PIA is doing to support appropriate laws and regulations, contact the PIA National Regulatory Affairs Department.