A certificate of insurance is requested constantly in commercial relationships and understood rarely. It is evidence of cover at a moment in time and confers no rights of its own.
It is a summary, not a contract
A certificate lists the policies in force, their limits, their effective dates and the insurer providing them, set out on a standard industry form.
It does not amend the policy, and its own wording states that the policy governs wherever the two disagree.
A requester holding a certificate has confirmation that cover existed on the date of issue and nothing beyond that.
Coverage can be cancelled, reduced or exhausted the following day without the certificate changing at all.
Additional insured status comes from an endorsement
Being named on a certificate does not make a party an additional insured. That status is created only by an endorsement attached to the policy itself.
The endorsement defines the scope, which may be limited to liability arising from the named insured's work and may exclude the additional insured's own negligence.
Requesting a copy of the endorsement rather than only the certificate is what confirms the status actually exists.
Limits shown may be shared or eroded
Aggregate limits apply across every claim in a policy period, so a limit displayed may already be partly consumed by earlier claims.
Where defence costs erode the limit, the amount available shrinks as a case proceeds and before any settlement is reached.
Per-project aggregate endorsements exist to address that, and their presence is visible only in the policy itself.
A certificate showing a large limit therefore says considerably less about available cover than it appears to.
Cancellation notice is not what it once was
Certificates once promised advance notice of cancellation to the holder, and current standard forms have largely removed that undertaking.
Notice obligations now generally follow the policy terms and applicable law rather than anything printed on the certificate.
A holder relying on being told about a cancellation usually needs that written into the underlying contract or added by endorsement.
Otherwise the first indication of a problem is a claim that finds no cover behind it.
Verification is a process rather than a document
Certificates are issued by brokers in volume, and errors in limits, dates and entity names are common enough to expect.
Confirming the exact legal entity matters, because cover follows the named insured and a related company may not be covered at all.
Requesting renewal certificates on a schedule is what turns a one-off document into continuing evidence.