Relying on a Certificate of Insurance? Better read it first.
Risk management law experts – notably those at International Risk Management Institute, Inc., whose outstanding website is a treasure trove of useful information — have warned for years that Certificates of Insurance are “one of the more dangerous documents that float between insureds, insurers, and a myriad of third parties. . . .” Proof can be found almost every week in the advance sheets; the latest is West Bend Mutual Ins. Co. v. Athens Construction Co. Inc., 2015 Ill. App. Unpub. LEXIS 255 (Ill. App. [1 Dist.] February 17, 2015).
Athens thought it was an Additional Insured. Athens had in its hands a Certificate of Insurance that said, expressly, that Athens was an Additional Insured: W. Bend Mut. Ins. Co., 2015 Ill. App. Unpub. LEXIS 255 at **4-5 (“‘Athens Construction Co. Inc. is an Additional Insured. . . .’”) (quoting the Certificate of Insurance). But Athens wasn’t an Additional Insured, because the policy did not make Athens an Additional Insured. So held the trial court; so held the court of appeals.
What about the Certificate of Insurance? Worthless to Athens, according to the court of appeals, because it contained this conspicuous disclaimer:
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.
The standard Certificate of Liability Insurance is a form, so the one that you are relying on today almost certainly says exactly the same thing. When something goes wrong, however, what will matter is what the policy itself says.