Verifying insurance certificates: A how-to guide
How is insurance verified?
To prove that coverage exists for an insured party, a COI (Certificate of Insurance) is often requested or required by a third party. For the insured, it is a digital or physical form that shows proof of being covered by a particular type of coverage (e.g., casualty, liability, etc.) in the event of a claim being filed against them by a third party.
Any time that a specific insurance plan needs to be verified by a regulatory body, legal representative, employer, etc., a COI is the final proof of its coverage. And while it isn’t a legal contract, it is evidence that an insurance contract exists between the person insured and the carrier.
What to look for on a COI
Usually, COIs contain one page of pertinent information organized in a recognizable pattern. Here are a few things to look for on a COI, confirming the document is legitimate and not fraudulent.
Basic information about both the policy and parties involved, including:
- Effective policy date
- Name of the insured with contact information
- Producer serving the policy
- Company providing the coverage, labeled using letters
COIs also contain detailed information about the specific coverage being provided and final information on the holder of the certificate, including:
- Certificate holder that matches the “insured” above
- Statement from the insurer stating they may – but are not obligated to – notify the holder of the certificate in the event of a cancellation of the policies on the certificate
- Authorization representative of the insurer
Certificate management
Standardization of COIs streamlines the verification process while also making it feasible for companies to be able to process large amounts of COIs for different coverages, policies, and insureds. But even with standardization, it can be challenging for larger companies to manage the COIs with the growing network of their strategic partners.
LenderDock makes COI management simple & easy
LenderDock is the first and only cloud-based solution that empowers banks and lenders to generate On-Demand Certificates of Coverage and Evidences of Insurance all in real-time. Insurance providers recapture significant time and resources by enabling a true self-service environment for loan originators and mortgage banks to access and verify necessary policy-related data. Insurers across the country are taking advantage of LenderDock’s platform for immediate and valuable cost savings and operational efficiencies. To learn more about LenderDock’s unique lienholder process automation ecosystem, contact [email protected].