Everything You Need to Know About Certificates of Insurance Part 2: Tracking COIs

Anyone whose job entails risk mitigation—from risk management specialists to project managers and even business owners—should be familiar with the basics of a Certificate of Insurance (COI).


This guide provides everything you need to know to successfully track and monitor COIs, regardless of your budget or the number of documents and vendors you deal with.


You're currently reading Part 2 of our Everything You Need to Know About Certificates of Insurance series.

To learn more about what COIs are and why they're important, we encourage you to read Part 1 of the series. 

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Given the critical role that these documents play in ensuring that your business is covered against claims for damages and other liabilities, it is important to know that merely being aware of COIs is not sufficient to adequately protect your business. 

Truly insulating your organization from risk requires much more than simply collecting COIs at the outset of a project, or when a new vendor or contractor comes on board. For your COI management to be truly consistent, with no coverage gaps or lapses, it is vital to track COIs over time

What Is a Certificate of Insurance?

A COI provides proof that a vendor or contractor has current, valid insurance, along with quick access to the essential details of the coverage. These include the type of coverage, dates when it is valid, and financial limits in the event of a claim. To learn more about the basics of Certificates of Insurance, check out our comprehensive explainer.

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Why Do I Need to Track COIs?

Tracking COIs is an essential piece of any organization’s risk management strategy. In a world with an ever-increasing amount of data and documentation—both virtual and physical—it can be easy to lose track of important information, dates, contract terms, and more. In the event of a vendor’s insurance lapsing, for example, this can lead to expensive, even potentially catastrophic outcomes for your business.

As such, there are many benefits to tracking COIs, including:

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1. Eliminating coverage lapses by setting automated notifications that end dates are approaching.

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2. Improving productivity and on-time completion rates by ensuring workers can remain on the job site.

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3. Gaining better insights and identifying potential coverage gaps by centralizing your data.

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4. Protecting your organization as project scopes, conditions, and active vendors and contractors change over time.

It’s clear, then, that tracking COIs is one of the most important risk management steps you can put in place for your business—and it’s something that can be done regardless of budget or the scale of your company. Solutions for COI tracking range from relatively simple in-house methods, such as a spreadsheet, to more sophisticated outsourced services that can include in-depth coverage review from teams of specialists.

When to Ask for a Certificate of Insurance

Broadly, you should always ask for a certificate of insurance when a vendor or contractor will be performing work that increases your liability. Specific types of liability include financial risks related to injury or death on the job—even if it’s not on your property—as well as equipment and property damage, and delayed, incomplete, or substandard work. 

In addition, you should always ensure that you request and verify COIs before allowing the vendor or contractor to begin work. Even if a contractor provides a verbal assurance, there is no guarantee that they fully understand the terms and conditions of their insurance, or how it relates to your business.

In fact, verifying a contractor’s COI is an essential step for assessing whether their insurance is sufficient to meet your needs for risk mitigation. In cases where it is not, an umbrella or excess insurance policy may be necessary to provide extra financial protection and/or eliminate coverage gaps.

Who Gets a Certificate of Insurance?

Certificates of insurance are issued on behalf of the insured party (typically the vendor or contractor) by an insurance company. Usually, an insurance company will issue a copy of the COI—the proof that the insurance exists—to the insured party, either at the time the policy is purchased, or when requested. 

In turn, when a contracting organization requests proof of insurance, the potential vendor or contractor would provide the COI directly to the client.

In cases where a vendor or contractor has to change the insurance duration, coverage levels, or both, it is essential that the client requests a new COI as proof that the changes have been made and are in effect prior to allowing them to begin work.


How Long Should I Keep a COI?

Once a contractor has provided a COI, there is little reason for a client to discard or delete it, even after it expires.

Consider again that the function of a COI is simply to provide proof a contractor held a specific level of insurance for a defined period of time. However, while the period of coverage may end on a given date, the liability for damages or injury that occured within the period can remain even after the project is completed. For example, in the event of an industrial injury caused by the use of harmful materials on the job, the effects may not show up for months, or even years. If and when they do, having a record of not only the contractors on the project, but proof of their insurance coverage, can protect your organization while ensuring that victims receive appropriate restitution.

Additionally, in the event of a labor dispute, the COI can help a client organization prove that a contractor was not engaged as a full-time employee. This can be important in the context of disputes over labor issues such as health insurance provision, paid time off, and more.


With this in mind, a comprehensive COI tracking process involves not just monitoring coverage on ongoing work, but the ability to archive past evidence of coverage to protect your organization over the long term. 

What Are Common Challenges Associated With COI Tracking?

If you’re thinking about implementing your own COI tracking solution, there are a few key problem areas you should factor into your planning:
  1. Tracking COIs manually can be time-consuming.
    There’s no way around it: COI tracking takes time and effort, and it can get tedious and repetitive. If you’re planning on taking on this role yourself, or assigning it to someone in your organization, be aware that it can involve: multiple requests and follow-ups with contractors to actually get the documents; manual data entry into your tracking system; collation and analysis of data to ensure you’re adequately protected; and a robust system of reminders to ensure that your contractors’ coverage never lapses or becomes inadequate as the scope of a project increases.

  2. Risk analysis can be complicated.
    As suggested in the point above, collecting and tracking COIs is only half the battle; analyzing the data collected and using it to make calculated decisions on behalf of your business is where the real challenge lies in any effort to track COIs.

  3. Your results are only as good as the effort and expertise you put in.
    Assigning COI tracking to someone who does not have adequate time and/or knowledge of the risks involved can have devastating consequences—with the risks increasing exponentially with the size and complexity of your business. As such, if you are looking to establish an internal COI tracking system, be sure to provide training for the employees responsible, and ensure that they have enough time to do the job properly. Need help getting started? Check out these COI tracking tips, tools, and free resources.

What Makes a Good COI Tracking Process?

Any COI tracking process should take account of the fact that there is a wide variety of types of insurance certificates, as well as a high degree of variance in the quality of the information provided on them. 

While the full process will depend greatly on the needs of your organization and the number of certificates it handles, in general, the collection and tracking process should:

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  • Be articulated in language
  • Have support from senior management (e.g., CFO, risk manager, etc.)
  • Have clear lines of authority spelled out for collection, compliance review, and acceptance and monitoring of certificates, including exceptions
  • Provide a clear documentation trail for each certificate, including corrective actions
  • Allow for regular review, update and audit of the process, with a mechanism for continuous improvement
  • Be supported by COI tracking software or other tools 

Tracking COIs In-House

Tracking certificates of insurance in-house can be a challenge – especially if you don't have the best tools to do so in an organized fashion. Most businesses performing COI tracking in-house benefit from making use of the following tools:

Excel Template
Managing Your COI Tracking In-House

For more information on these tools and methods, check out this post.

While there are a number of ways to track COIs in-house for free, in our experience there is no substitute for a spreadsheet-based solution.

At BCS, we put our combined years of specialist knowledge to use and created a free COI tracking template download. While it can’t request COIs from your vendors or enter the data, it achieves everything else small- and medium-sized businesses need to get started with managing COI tracking in-house. And did we mention that it’s free? Download it here.

Managing COI Tracking In-House vs. Working With a Provider

For many small businesses, tracking COIs in-house may be the only viable option from a financial perspective—especially if the company only works with a limited number of contractors or vendors on a regular basis. 

However, as organizations grow in scale, the question for most business owners and leaders changes from “How can I track COIs in-house?” to “Is it better to outsource the service or maintain an internal team to track COIs?” 

Ultimately, that decision will come down to a fairly small set of factors:

  • The size of your company 
  • The availability of internal resources
  • Knowledge and/or training of employees
  • The number of vendors and contractors you work with; and
  • The financial risks they pose

While there’s no simple answer to that question, one good rule of thumb to consider is as follows: If the solution you’re using puts your fears about exposure to liability to rest, then it’s the right one for the time being. And, if something changes to reignite those fears, it may be time to look at an alternative.

Finding the Best COI Tracking Solution

If, having evaluated the needs of your business, you decide that tracking COIs is a job that would be better to outsource, there are a number of potential providers offering solutions at a variety of price points. When evaluating these providers, here are a number of useful questions to ask both yourself and any potential vendor:

  • Do I need a software-only or full-service solution?
  • What does “full-service” include?
  • Will this process be managed by professional COI analysts with insurance expertise?
  • Does this solution have international capabilities?
  • Can this solution scale with my business?

For more tips, check out this related post on “How to Find the Best COI Tracking Solution.”

For more tips,

check out this related post on “How to Find the Best COI Tracking Solution.”

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