Can You Spot a Fraudulent COI? It’s Harder Than You Think.

August 5, 2016

The world of insurance can be very confusing to anyone – especially if the individual handling Certificates of Insurance (COIs) has no insurance background or hasn’t worked with insurance documents or endorsements in the past. And unfortunately, fraudulent COIs – while not extremely common – are certainly used by subcontractors caught in difficult situations and can easily be downloaded by conducting a simple Google search. If your COI administrator isn’t able to catch the error, then you and your organization could be at risk of major legal repercussions should something go wrong.

Producing a Fake Is All Too Easy

A recent article published by Hayes Insurance and authored by Cheryl Rushing claims that, “Any business can pass off a fake certificate under the right (or wrong) circumstances, even subcontractors you may consider to be honest to a fault.” The same article goes on to explain 3 scenarios where this could happen:

  • A subcontractor that you’ve worked with before runs into money troubles. His insurance lapses due to nonpayment, but he needs the work, so he doctors an old certificate to look current.
  • The employee of a former subcontractor goes out on his own and can’t afford insurance yet, so he uses a copy of the certificate from his former employer to provide proof of coverage. Just a few keystrokes on his computer and he’s suddenly “insured”. He’ll buy coverage when he can afford it.
  • A subcontractor purchases a bare bones policy and doesn’t want to pay for those fancy extras like primary & noncontributory endorsements or an additional insured, so he takes the certificate from his insurance agent and adds that wording in after-the-fact to meet your contract requirements.

Do these scenarios take you by surprise? No matter how honest or upstanding an individual may be, if he or she is placed in the wrong circumstances, it’s possible that they could pass through a fraudulent COI. And if your COI administrator doesn’t know the difference, then the risk is yours.

Do You Know How to Spot a Fake?

Do you or your COI administrator know what to look for when reviewing your subcontractors’ COIs to determine whether it’s a fake or not? With just a few steps, it’s possible to determine whether the certificate is valid or not – and doing so may just save your organization from a tough (and expensive) legal battle. recently published an article entitled, “How to Spot Fake Certificates of Insurance”, which explains several common signs of a fradulant COI:

Acord 25. The most trustworthy insurance agencies utilize the Acord 25 form. Check the bottom left-hand corner of the COI to ensure that the certificate says “Acord 25.”

Legitimate companies. Look at the insurance company on the top right of the certificate. Contact your insurance agent to make sure the company is legitimate. You can also visit to look up the insurance company in question, and then use the “ratings and analysis” section to verify that the insurance company listed on the certificate actually exists.

Handwriting/mismatching fonts. Examine the policy’s effective and expiration dates and description of operations section. Make sure that information is aligned properly and typed in the same font as the rest of the document.

Lack of response. Call the insurance company listed on the form to verify the certificate’s accuracy.

Don’t Wait Until It’s Too Late

Fraudulent COIs could cost your organization an incredible amount of resources – both financial as well as time if a lawsuit transpires. It’s incredibly important to address any issues with COIs and endorsements before a subcontractor begins working. If an accident were to happen, then it’s already too late to rectify the insurance situation. It’s a best practice for COI administrators to collect and review COIs and endorsements immediately, checking for accuracy as well as potential fraud.

Protect Your Organization

myCOI is a cloud-based software solution and exists for one reason: to help you handle the everyday tasks of managing certificates of insurance and protecting your company against underinsured claims, costly litigation and failed audits. The software and certificate tracking services are combined into an easy-to-use solution developed and supported by a team of insurance professionals and is built on a foundation of insurance industry logic to automate the COI communication process and ensure you remain protected.

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