Fraudulent Certificates of Insurance Present Real Risks. Are You Prepared?

February 8, 2017

In the past, we’ve discussed the risks of fraudulent certificates of insurance and we’ve explained the potential pitfalls involved if each and every certificate of insurance and associated endorsements aren’t carefully reviewed.However, we haven’t demonstrated just how prevalent (and easy!) it can be to create a fake certificate of insurance. As a compliance administrator, you have enough weighing on your shoulders without adding the additional pressure of potential fraud when it comes to your contractors and third party vendors. But unfortunately, fraudulent COIs present a real risk and your organization needs to be aware of the threat, as well as know what to look for when determining if a certificate is the real deal, or if it’s a fake.

In this post, we’ll show you just how easy it is for one of your vendors to slip through a fake certificate, but more importantly, we’ll give you tips to ensure one doesn’t get past your desk.

Fraudulent Certificates Are Easy to Create

It takes almost no effort or creativity for contractors and third party vendors to bypass the system. To prove what we mean, we created a fraudulent certificate in less than 5 minutes. We simply searched “blank certificate of insurance template” in Google, and several results immediately populated. The first hit took us to a free PDF download page with the ability to download multiple insurance documents, including a certificate of insurance.

As you can see from the images below, the templates look unmistakably like the real deal forms that you’d receive from a legitimate insurance agent.

How to Spot a Fraudulent Certificate

Do you know what to look for when reviewing each and every certificate 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 whether it’s a fraudulent certificate. Following the below process may just save your organization from dealing with a tough (and expensive) legal battle. published an article entitled, “How to Spot Fake Certificates of Insurance”, which explains several common signs of a fradulant certificate. According to the resource, these signs to watch for include:

  • Acord 25. The most trustworthy insurance agencies utilize the Acord 25 form. Check the bottom left-hand corner of the certificate 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.

What Happens If a Fraudulent Certificate Slips Through?

If a fraudulent certificate slips through the cracks, at the most basic level, the insurance that your organization was planning on is absent. This leaves your organization potentially liable in the event of an accident, a lawsuit, or any other kind of insurance threat. There are many risks that could happen if a fraudulent certificate of insurance isn’t caught.

First, consider that the individual may not be covered in the way the certificate seems to represent. That’s why it’s incredibly important that you see the endorsements for yourself and verify the correct statuses are included, such as “ongoing operations” (coverage while work is taking place) and “completed operations” (coverage when work is completed).

Next, if your organization has requested a Waiver of Subrogation in contracts and agreements, but never confirmed that the correct language was added to the policy, you could be exposed to a possible action from the insurer for recovery of funds paid for the claim in question. Once again, this is why it’s incredibly important to always collect and review endorsements.

Last but not least, if a claim for liability comes up, the first party that’s looked at is the one with the deepest pockets, which is also a consideration in WHO is named in the lawsuit. The aftermath could lead to a costly lawsuit and a major distraction of staff.

Is Your Compliance Process Protected?

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.

Ready to Learn More?

Interested in learning more or want to see myCOI in action? Request a product demo or sign up for our newsletter to stay in the know.

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