August 14, 2018

Certificate of Liability Insurance

Is one of the two forms in which certificates of insurance are issued.  The primary purpose of the certificate of liability insurance is to provide proof that an individual or entity has insurance coverage in place prior to entering a business relationship with another.  The business relationship between a general contractor and a subcontract is a good example.  The general contractor can possibly be held responsible for some actions of subcontractors working under him.  If the subcontractor doesn’t have insurance, or if their policy limits are inadequate, the general contractor and/or their insurance company may be held accountable.

Related Term:

• Acord Form 124 or the Certificate of Property Insurance