A certificate of insurance for contractors is the proof, issued by the contractor's insurance agent or insurer, that a subcontractor or vendor carries the insurance your contract requires. On its own it proves very little. It's worth something when you decide what to require before you hire and write that into the subcontract or vendor agreement. Then you collect the certificate before work starts, again at every renewal, and after the job ends if the contract requires completed operations coverage.
This guide is for the company doing the hiring: the owner who signs the subcontracts and the office manager who chases the paperwork. For the basics, start with what a certificate of insurance is and the 8 checks before you accept one. If you're the sub who's been asked for one, your insurance agent issues it, usually at no cost.
It won't tell you what limits to require. That depends on your project, your client's contract, state law and your broker. Where it does show typical numbers, it names the source.
Certificate of insurance for contractors: start with the contract
A certificate can only pass or fail against a written requirement. If your subcontract says "sub shall carry adequate insurance," every certificate that arrives turns into a judgment call.
For a complete requirement, look at how a public agency writes one. The Oregon Department of Transportation's subcontractor insurance requirements (Exhibit F) require subs to have the insurance in place before work starts and keep it for the whole subcontract. The grant recipient hiring the subs can't let work begin until then, has to check compliance at least once a year, and must receive the additional insured endorsements along with the certificates.
Your subcontract insurance requirements clause should answer the same questions. Your lawyer or broker writes the wording; make sure it covers:
- Each coverage and its minimum limit, listed one by one.
- Additional insured status for your company (and your client, if your contract with them requires it), for ongoing and completed operations.
- Waiver of subrogation and primary and noncontributory wording, if your broker recommends them.
- When proof is due: before the sub starts work, at each renewal, and for how long after completion.
- What counts as proof: the certificate plus copies of the endorsements, sent by the sub's agent.
- The sub's duty to tell you if a policy is cancelled or changed, since the insurer usually won't.
- Your right to stop work or hold payment if coverage lapses.
- A flow-down clause, so the sub requires insurance from its own subs.
For what additional insured status and a waiver of subrogation do for you, see certificate holder vs additional insured.
Subcontractor insurance requirements by type of work
A roofer on your site and a firm that ships you printer paper carry different risks. Group subs and vendors by what they do and set requirements per group. Bring the table to your broker as a starting point. It isn't a standard.
| Type of work | Coverages usually asked for | Questions for your broker |
|---|---|---|
| Construction trades working on your job site | General liability (including products and completed operations), auto liability, workers' comp and employer's liability | Umbrella or excess to reach higher limits; additional insured for ongoing and completed work; waiver of subrogation |
| Service vendors on your premises (cleaning, landscaping, security, maintenance) | General liability, workers' comp and employer's liability, auto if they drive for the job | Additional insured on general liability |
| Anyone who drives for the job (delivery, hauling, equipment transport) | Auto liability covering the vehicles used, plus general liability | Coverage for hired and non-owned vehicles if they use rentals or personal cars |
| Professional services (design, engineering, consulting, IT) | Professional liability, general liability if they come on site | Whether to ask for any other coverage if they work in your systems or handle your data |
| Suppliers that only deliver goods | General liability, which usually includes products coverage | Whether any requirement is needed at all |
| Trades that handle hazardous materials (abatement, environmental work) | The construction set above | Whether the work calls for pollution coverage on top of it |
Professional liability covers a different risk from the rest of the table. The SBA describes it as coverage for financial loss from "malpractice, errors, and negligence," while general liability covers bodily injury and property damage. An engineer's mistake can cost you money without anyone getting hurt.
Workers' comp follows state law. The SBA says businesses with employees must carry it, but each state sets its own rules; according to the Texas Department of Insurance, most private employers in Texas can choose not to. If an uninsured sub's worker is hurt, the bill can come to you. In Minnesota, the Department of Labor and Industry explains that a general contractor is liable for all the workers' comp benefits owed to an uninsured subcontractor's injured employee. The rules vary by state, so check yours with your broker.
Typical limits, and why you shouldn't copy them
There's no single answer to "how much should I require?" Two published examples show what's common.
| Coverage | ODOT Exhibit F minimum for subcontractors | Nationwide's premium audit threshold |
|---|---|---|
| General liability, each occurrence | $1,000,000 | $1,000,000 |
| General liability, aggregate | $2,000,000 annual aggregate | $2,000,000 general aggregate |
| Products-completed operations aggregate | Coverage required, no separate figure | $2,000,000 |
| Auto liability | $1,000,000 combined single limit | Not listed |
| Employer's liability | $500,000 each accident | Not listed |
ODOT's figures are minimums for subcontractors on its own grant-funded work, and the exhibit lets the grant recipient require more based on the risk. Nationwide's numbers measure something else: below them, its premium auditors treat a sub's insurance as inadequate and add a payroll charge to the contractor's audit. Neither is a recommendation for your company.
Your real minimums come from above you. If the owner's contract makes you and your subs carry $2 million, that's your floor. ODOT also lets a sub reach the required limits with a primary policy plus an umbrella or excess policy. So a certificate showing $1 million in general liability and a $1 million umbrella may meet a $2 million per-occurrence requirement, if your contract allows it and the umbrella follows the underlying policy's coverage.
Certificate of insurance for vendors
Vendors usually don't sign a subcontract. They work off a purchase order, a service agreement or nothing at all. If the insurance terms aren't in something the vendor signed or accepted, you can ask for a certificate but can't hold them to anything specific.
Three places to put vendor insurance requirements, from strongest to weakest:
- A master service agreement with an insurance clause, for vendors you use all year. They sign once, and you collect certificates at each renewal.
- Your purchase order terms, with an insurance section that applies when the vendor works on your premises.
- A one-page insurance requirements sheet attached to the quote request, so the vendor prices the insurance in before you agree.
Then scale the request to the risk. A cleaning crew in your building every night fits the service vendor row of the table. A one-time supply delivery might need nothing. Write the tiers down so you aren't deciding from scratch for every vendor.
When to collect a subcontractor certificate of insurance
A subcontractor certificate of insurance only proves coverage until the first policy on it expires, so one at onboarding isn't enough.
Before work starts
Get the certificate, and the endorsements your contract requires, before the sub sets foot on site. Nationwide's audit guidance says to get a workers' comp certificate from every sub before they begin any work. Check it against the contract with the 8-point checklist, or walk through an ACORD 25 sample box by box if the form is new to you.
Ask for a new one for each job, even from a sub you've used for years. The Hartford recommends this too, since coverage can change between jobs.
At every renewal
Each policy on the certificate can expire on a different date. Track the earliest one and ask for the renewed certificate before it passes. If the job runs past that date and no current certificate has arrived, your contract should let you stop work until one does. Collect again, too, when a sub switches insurers mid-year or a new project has higher requirements.
For completed operations, if the contract says so
Some claims show up after the work is done, like a leak from plumbing installed last spring. That's what completed operations coverage is for, and why ODOT requires the CG 20 37 endorsement for completed work alongside the CG 20 10 for ongoing work.
If your contract requires the sub to keep that coverage for a set number of years after the job, the certificate from the year they worked only shows the policy in force that year. To know the coverage continued, you need the renewed certificate, and the renewed endorsement, for each year of that period. How a particular policy responds to a late claim depends on its wording, so ask your broker; the American Bar Association has a longer guide, written for lawyers, on how liability claims are handled, including occurrence and claims-made policies.
When a subcontractor can't meet a requirement
First find out exactly what's wrong. Each gap has a different fix.
- Limits too low? The sub may be able to add an umbrella or excess policy, or raise the limit. Both cost money, so settle it in the bid, not the week before they start.
- Missing endorsement? The sub's agent can often add an additional insured or waiver of subrogation endorsement, sometimes for an added premium.
- Missing coverage? It depends on the sub. One with no auto policy who never drives for the job may be a reasonable exception; one with employees and no workers' comp is a different conversation.
- Some policies cover only certain kinds of work. A sub insured as an electrician who's doing framing may not be covered for it.
Then someone decides: the person who signs your contracts, ideally after a call with your broker, not the admin who received the certificate. If it's an exception, write down what was waived, for which sub and project, who approved it, and until when.
Saying yes anyway has a cost. BITCO's premium audit page says the contractor is generally responsible for injuries or damages to third parties caused by its uninsured subcontractors, and its audit will include a sub's payroll if there's no current certificate. Part of the gap can end up in your own premium.
How to keep certificate records
Good records answer two questions fast: is this sub covered today, and was it covered on the day something happened? For each sub or vendor, keep:
- One row per policy: coverage type, insurer, policy number, limits and expiration date.
- Whether the required endorsements are on file, and for which contract.
- Who on your team follows up.
- Every certificate and endorsement received, by policy period. Don't overwrite last year's file.
- Any approved exception, with the approval.
Old certificates matter. Nationwide's audit guidance says certificate dates must cover the period the sub worked during your policy period, so an auditor may ask for certificates from a period that has ended. A claim for completed work can arrive years later. How long to keep them depends on your contracts and insurer, so ask your lawyer and write the answer down.
A spreadsheet works with a handful of subs. With dozens, each with policies renewing on different dates, follow-ups slip. ExpirationPilot keeps every certificate's expiration dates in one list, with one person responsible for each, and emails reminders 30, 14 and 7 days before by default. It can email the sub a link to upload the renewed certificate (they don't need an account) and follow up once a week, up to six times, until a file arrives. Someone on your team still opens each file, checks it against the contract and approves or rejects it; the software doesn't read coverage. For certificates only, see COI tracking.
Quick answers
What is a certificate of insurance for contractors?
A one-page summary, usually an ACORD 25, of a contractor's insurance: coverage types, limits, policy numbers and dates, issued by their agent or insurer.
What is a COI in construction?
In construction, a COI is the certificate of insurance a general contractor or owner collects from every subcontractor before work starts, and again each time a policy renews. It usually lists general liability, auto, umbrella and workers' comp. You check it against the insurance clause in the subcontract.
Does my business insurance cover independent contractors I hire?
Don't count on it. Your policy is written for your business, not the contractor's. If they have no insurance of their own, a claim from their work can land on you and your insurer. In many states you can also owe workers' comp to their injured employees, and at audit Nationwide may add an uninsured contractor's payroll to your premium base. Get their certificate, and ask your broker how your own policy treats uninsured contractors.
What happens if my subcontractor doesn't have insurance?
If their work injures someone or damages property, the claim can land on you and your insurer. In some states you can also owe workers' comp benefits to their injured employees, and your insurer may charge premium for their payroll at audit. Don't let them start until the gap is fixed or an exception is approved in writing.
Do I need a certificate from a one-person subcontractor?
Usually yes, at least for general liability. A sole owner may be exempt from carrying workers' comp in some states, but Minnesota's labor department warns that a worker you call an independent contractor can still count as your employee under workers' comp law. What to require from one-person subs in your state is a question for your broker.