Always, Always Remember that ACORD is not an Insurer

February 14, 2021

If you’re seeking liability insurance for your self-owned business or you’re an independent contractor, you might find yourself overwhelmed by all the different types of insurance. The multitude of information you have to deal with to become insured can make for difficult research.

ACORD liability insurance is a popular topic for people who are in the market for coverage. ACORD’s presence in the industry can confuse those who don’t know what it is. However, those who understand its place in insurance compliance can properly utilize this powerful resource.

What is ACORD Insurance?

You might have already come across something called ACORD. It has to do with insurance and sounds official as if it’s a trusted source.

What is ACORD insurance?

Quite simply, ACORD insurance isn’t anything. It doesn’t exist.

You can search for an ACORD insurance quote, but you probably won’t find what you’re looking for – especially if you’re shopping for a policy. The same thing is true if you’re trying to find information regarding an ACORD insurance rating. You won’t discover anything concerning ACORD insurance, because ACORD isn’t what you think.

A question like “what is ACORD certificate of insurance” can bring you closer to the truth.

ACORD is the Association for Cooperative Operations Research and Development. The non-profit organization issues and archives standardized insurance forms. ACORD insurance forms are used by companies across the United States because they adhere to industry guidelines.

An ACORD evidence of insurance form is proof of coverage similar to a certificate of insurance (COI). A COI confirms that the insured party is indeed covered. This confirmation mitigates an company’s risk when they hire contractors or vendors. Authentic COIs can help companies verify their third parties’ insurance statuses.

An ACORD certificate of insurance sample found online can give you a general idea about what information should be found on one. However, an example is no substitute for the real thing. Downloading an ACORD certificate of insurance from the official ACORD website is possibly more valid than obtaining one randomly from the Internet. There are also different forms depending on types of coverage like the common ACORD 25. You should determine which ones apply to your situation.

Okay, What is an ACORD 25?

A common ACORD insurance form is the ACORD 25. It is the standard general liability insurance certificate. The form proves that the insured party’s coverage is active.

A sample ACORD 25 should contain the:

  • insured’s name.
  • name of their company.
  • policy number.
  • insurance company’s National Association of Insurance Commissioner (NAIC) number.
  • type of liability insurance protection.
  • effective date.
  • limits of the protection.

Fraudulent ACORD 25 certificates might omit some of these items. Elaborate certificates can appear genuine under scrutiny. It’s crucial to double-check all certificates of insurance for authenticity.

Accuracy is also critical. Sometimes the incorrect form is used for a particular type of coverage. The volume of different ACORD insurance forms isn’t necessarily burdensome to navigate, but it is sometimes confusing.

Other ACORD Insurance Forms

Although the ACORD 25 is probably the most used document that proves insurance coverage, other forms perform the same function but for different kinds of protection:

  • ACORD 23: Vehicle or Equipment Certificate of Insurance – reports coverages provided to a single specific vehicle or piece of equipment. This can be useful for workers who use their own cars for business purposes.
  • ACORD 27: Evidence of Property Insurance – details coverages of property coverage to another party who has an interest in a particular property and/or the contents of the property.
  • ACORD 28: Evidence of Commercial Property Insurance – relays coverages provided to property used during the course of business, like a physical location, for example.

What to Remember About ACORD

  • ACORD provides proof-of-insurance forms.
  • ACORD does not offer insurance and can not cover anything. ACORD liability insurance does not exist.
  • A certificate of insurance ACORD provides can be downloaded or electronically completed. Some forms require special printing and handling. They can take longer for delivery.
  • ACORD offers resources to help facilitate the completion of forms.
  • Insurance agents or brokers typically issue certificates of insurance, not insured parties

It’s also important to make sure you keep track of all of the ACORD forms that your company provides to other entities to show proof of insurance. The forms are proof that you are covered like you claim you are. Any company that hires you to do work will probably ask for them. Having the forms ready can make their job easier as well as possibly keep you employed.

Even though ACORD doesn’t furnish insurance, they still play an essential role in the industry. If you know what ACORD is, then you can be better prepared to manage your insurance affairs.

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