ACORD forms are a topic that inevitably comes up for people working in and around the world of insurance coverage.
Let’s start here: The Association for Cooperative Operations Research and Development, or ACORD, is a nonprofit organization that issues and archives standardized insurance forms.
Though not an insurance provider itself, ACORD is a very important presence in the insurance industry, as its forms help standardize documentation and verification processes while adhering to industry guidelines. The most common use case of ACORD forms is to provide proof of insurance coverage for a party.
In this blog, we’ll discuss what that means, which ACORD forms are most utilized, and how better to manage your vendors’ proof of coverage with COIs.
What Is an ACORD Proof of Coverage for Insurance?
Technically, there’s no ACORD document that’s called the “proof of coverage” form. What people are referring to when they mention a document that provides proof of insurance coverage is a certificate of insurance services, known in shorthand as a COI. A COI is essentially an official, summarized version of an insurance policy, and since a policyholder’s insurance provider is the only party able to issue it, it provides evidence of their insurance coverage.
The ACORD 25 form, also known as the certificate of liability insurance ACORD, is one of the most commonly used ACORD forms in the industry to provide proof of coverage. This form, like other COIs, encapsulates the most important details of an insurance policy, including necessary details about the policyholder, their insurance provider, the certificate holder (the party receiving the evidence), and their overall coverage.
What Is the Document that Provides Proof of Insurance Coverage?
The standard document that provides provide proof of insurance coverage is known as a certificate of insurance (or an insurance certificate or a COI insurance). ACORD produces COIs for various insurance policies, with the most common one being the ACORD certificate of liability insurance, ACORD 25. Some other kinds of COIs include ACORD 27, which provides evidence of personal property insurance, and ACORD 28, which deals with commercial property insurance.
What Is the Difference Between a COI and a Policy?
To clarify an important point: an insurance certificate is related to an insurance policy, but they are not the same thing. An insurance policy is a binding legal commitment that must be paid for in the form of monthly premiums from a policyholder to an insurance provider. An insurance certificate, or COI, is simply official proof that a policyholder has a policy in place. A policy can exist without a COI—but a COI cannot exist without a corresponding policy.
What Is an ACORD Proof of Coverage Example for Insurance?
You can find ACORD COI examples for various types of coverage online. However, we recommend only trusting ACORD’s website as a source for these PDF templates, as they are the official creator and standardizer of the documents used industry-wide. (Note that these forms should only be used for educational purposes, and you should never attempt to fill out a COI on your own; you must contact your insurance provider in order to do so.)
To show some of what an ACORD COI could read like, here is a theoretical ACORD 25 form template example:
- Name: Chris’ Cool Contracting Services
- Address: 1234 Fake Street, Anytown, USA
- Contact: Chris Champion
- Phone: 123-456-7890
- Name: Keep It One Hundred Insurance Services
- Address: 4321 Real Street, Anytown, USA
- Contact: Jill Jackson
- Phone: 777-888-9999
Certificate Holder Information:
- Name: ABC Buying Company
- Address: 1601 Pennsylvania Ave, Anytown, USA
Description of Operations:
- General contracting services in commercial construction projects
- Policy Number: 987654321
- Effective Date: January 1, 2023
- Expiration Date: December 31, 2023
- General Liability: $1,000,000 per occurrence / $2,000,000 general aggregate
- Products-Completed Operations: $2,000,000 aggregate
- Additional Insured: ABC Buying Company (as required by written contract)
- Jill Jackson, Insurance Agent
- 30 days’ notice of cancellation required
What Is a Letter of Coverage for Insurance?
In the realm of insurance, a letter of coverage is an important communication tool. It’s essentially a document provided by an insurance company in order to confirm the details of a policy’s coverage.
Letters of coverage are not as standardized as COIs, but they serve a similar function of providing information about insurance coverage to interested parties. For example, sometimes a requesting party may have unique requirements that a COI won’t fully address or wants a deeper explanation for some of the carried coverage; in that case, they’d request a letter of coverage.
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Managing ACORD COI forms from various vendors and third parties can be confusing, time-consuming, and prone to understandable human errors. If you’re ready to ditch the manual work and for someone else to do the heavy lifting when it comes to your compliance management, we’re the team for you. Give us a call to learn more.