What Do Clients, Lenders, and Counterparties Require on a Certificate of Insurance (COI)?
A certificate of insurance (COI) is the document that proves your coverage to the third parties who require it—customers, landlords, lenders, investors, and government agencies. Understanding what those parties actually require helps you structure policies that satisfy the contract instead of stalling it. The certificate itself is only one page, but what it has to show, and the policy endorsements behind it, are where deals get held up.
Short answer: Most contracts require a certificate—usually the ACORD 25 for liability—that shows the right coverages at the required limits, names the counterparty as a certificate holder, and reflects three endorsements: additional insured status, a waiver of subrogation, and primary and non-contributory wording. Lenders add a property requirement: an ACORD 28 naming them as mortgagee and lender's loss payable. Miss a limit, a coverage, or an endorsement and the certificate bounces.
Below: what a COI is (and isn't), who asks for one and what each party cares about, the handful of fields and endorsements that decide compliance, why admitted vs. non-admitted paper matters, and a checklist to run before you sign.
What is a certificate of insurance?
A certificate of insurance is a standardized, one-page summary issued by your insurer or broker that lists your policies, carriers, coverage types, limits, and policy periods. For liability coverage it is almost always the ACORD 25 (Certificate of Liability Insurance); for property evidence to a lender it is the ACORD 28 (Evidence of Commercial Property Insurance). It names the named insured (you) and the party receiving it (the certificate holder).
One thing a certificate is not: a grant of coverage. Every ACORD certificate carries a disclaimer that it is issued as a matter of information only and confers no rights on the holder—it does not amend, extend, or alter the coverage in the policy (opens in a new tab). The actual rights (additional insured, loss payee) live in policy endorsements, not on the certificate. That distinction is the single most common source of disputes, and we come back to it below.
Who asks for a COI — and what each party cares about
The requirement looks different depending on who's asking, because each party is transferring a different risk onto your policy.
| Who requires it | What they typically require on the COI |
|---|---|
| Clients & customers (vendor / MSA contracts) | Commercial general liability (often $1M/$2M), and for tech vendors cyber and technology E&O; the customer named as additional insured, with a waiver of subrogation and primary and non-contributory wording. |
| Landlords (commercial leases) | General liability plus property coverage on tenant improvements; landlord (and often its property manager and lender) as additional insured, waiver of subrogation, and notice of cancellation. |
| Lenders (loans, leases of equipment) | ACORD 25 with the lender as certificate holder / additional insured, and an ACORD 28 property certificate naming the lender as mortgagee and lender's loss payable; frequently business interruption coverage and advance notice of cancellation. |
| Investors & M&A counterparties | Evidence of directors & officers (D&O) and sometimes reps & warranties coverage as a condition of a financing or deal. |
| Government & licensing bodies | Workers' compensation, general liability at set limits, and in many cases a surety bond, as a condition of a permit or license. |
The fields and endorsements that decide compliance
Most companies ask "do I have the coverage?" Counterparties care about six specifics on, or behind, the certificate:
- Limits. Your limits of liability must meet or exceed the contract minimums—both the per-occurrence limit and the aggregate. When the required number exceeds your primary, an umbrella / excess policy stacks on top to reach it.
- Additional insured. An additional insured endorsement extends your liability policy to cover the counterparty for claims arising out of your work—so if they're sued over something you did, your insurance responds, not just theirs.
- Waiver of subrogation. A waiver of subrogation means your insurer agrees not to pursue the counterparty to recover what it pays on a claim. (Subrogation is an insurer's right to step into your shoes and recover from whoever caused the loss.)
- Primary and non-contributory. Primary and non-contributory wording makes your policy pay first and in full before the counterparty's own insurance contributes. Without it, the additional insured protection is materially weaker.
- Certificate holder / loss payee. The certificate holder is the party receiving the document; for property securing a loan, the lender is also named as mortgagee and loss payee so it receives the claim payment.
- Notice of cancellation. Counterparties want to be told if the policy lapses or is cancelled, so their protection doesn't quietly disappear.
Certificate holder vs. additional insured vs. loss payee
These three are routinely confused, and the difference is what makes a certificate compliant or not:
- Certificate holder — simply the party you send the certificate to as proof of coverage. Being a certificate holder grants no coverage on its own.
- Additional insured — an entity actually added to your liability policy by endorsement, so your coverage defends and indemnifies them.
- Loss payee / lender's loss payable — named on your property coverage and entitled to receive the loss payment for covered damage; for real estate this is usually styled as "mortgagee."
Because the ACORD certificate confers no rights, sophisticated parties—especially lenders—insist on seeing the underlying endorsement and the declarations page, not just the certificate. As one legal guide to lending transactions puts it, a lender should receive an ACORD 25 showing it as additional insured for liability and an ACORD 28 naming it as mortgagee and lender's loss payable for property (opens in a new tab), and should confirm status with the endorsement rather than relying on the certificate alone (opens in a new tab).
Admitted vs. non-admitted: why the policy form matters
Some contracts don't just specify coverage and limits—they specify the kind of carrier. A requirement that your insurer be admitted (licensed and backed by the state guaranty fund) or carry a minimum AM Best rating can trip up coverage placed with a non-admitted / excess & surplus lines carrier—which is exactly where many emerging-technology, AI, and crypto risks have to be placed. If the contract says "admitted" and your policy is E&S, you discover the mismatch when the certificate is reviewed, not before. Catch it early and you can request the form the contract needs or negotiate the requirement.
COI Requirement Checklist
Before signing an engagement letter or contract with insurance requirements, verify:
- Your actual coverage limits meet or exceed the required minimums
- Your policy form matches what's required (admitted vs. non-admitted)
- Additional insured endorsements are available for your policy types
- Your broker can produce COIs within the timeframe required
- Any required endorsements don't conflict with your coverage
- Your carrier will provide the requested notice provisions
What happens when your COI doesn't match the contract
A non-compliant certificate stalls the deal. Procurement, leasing, and lending teams treat insurance as a gating item, so a limit that's too low, a missing coverage, the wrong carrier type, or an endorsement your carrier won't issue can hold up a signing or a closing—or send the business to a competitor who's already compliant. Not every policy issues every endorsement, and some carriers won't add a particular additional insured or agree to primary-and-non-contributory wording at all; discovering that after you've signed means renegotiating coverage under a deadline.
The discipline is the same one we bring to placements for venture-backed startups and AI and emerging-tech companies: read the insurance and indemnification clauses before you commit, map each requirement to your general liability, cyber / tech E&O, crime, and D&O policies, confirm the endorsements will issue, and line up fast certificate turnaround so the close stays on schedule.
The bottom line
A certificate of insurance is proof, not coverage. The parties who require one specify the coverages, the limits, and the endorsements—and they check all of it before they sign or fund. The companies that clear the requirement quickly are the ones whose policies were built with those clauses in mind: the right lines at the right limits, with additional insured, waiver of subrogation, primary-and-non-contributory, and the right certificate-holder and loss-payable designations ready to issue on demand. Get it right before the contract lands, and the COI stops being the thing that holds up the deal.
Get contract-ready coverage and fast COIs from Alton Risk
We build insurance programs designed to satisfy your clients', landlords', and lenders' contracts—at the limits they demand, with the additional insured, waiver of subrogation, primary-and-non-contributory, and loss-payable endorsements they require, plus same-day certificate turnaround. Reach out to Alton Risk to start your application.
Book a consultation → (opens in a new tab)Related reading: Insurance requirements in enterprise contracts · General liability insurance · Cyber & technology E&O · Insurance glossary
Frequently asked questions
What do clients and counterparties require on a certificate of insurance?
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Most contracts require a certificate of insurance (usually the ACORD 25 for liability) that shows the required coverages (commonly commercial general liability, and for technology vendors cyber liability and technology E&O), the required limits (per-occurrence and aggregate), the counterparty named as a certificate holder, and three endorsements reflected on or attached to the certificate—additional insured status, a waiver of subrogation, and primary and non-contributory wording. Many also require advance notice of cancellation.
What is the difference between a certificate holder, an additional insured, and a loss payee?
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A certificate holder is simply the party receiving the certificate as evidence of coverage—it grants no coverage by itself. An additional insured is an entity actually added to your liability policy by endorsement, so your coverage extends to defend and indemnify them for claims arising from your work. A loss payee (and for lenders, a lender's loss payable or mortgagee) is named on property coverage and is entitled to receive the claim payment for covered property damage. Being listed as a certificate holder is not the same as being an additional insured or loss payee; those require policy endorsements.
What does a lender require on a certificate of insurance?
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Lenders typically require two things. For liability, an ACORD 25 (Certificate of Liability Insurance) showing the lender as a certificate holder and, where the loan documents require it, as an additional insured. For property securing the loan, an ACORD 28 (Evidence of Commercial Property Insurance) with the lender named as mortgagee and lender's loss payable, so the lender receives the loss payment on a covered claim. Lenders often also require business interruption coverage and advance notice of cancellation.
Why doesn't a certificate of insurance prove I actually have additional insured coverage?
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An ACORD certificate is issued as a matter of information only and confers no rights on the holder—it does not amend, extend, or alter the coverage in the policy. Additional insured and loss payee status are created by policy endorsements, not by the certificate. That is why sophisticated counterparties ask for the actual endorsement and declarations page, not just the certificate, to confirm the coverage is really in place.
What happens if your COI doesn't match the contract?
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A non-compliant certificate stalls the deal. Procurement, leasing, and lending teams treat insurance as a gating item, so a limit that's too low, a missing coverage, the wrong policy form (for example a non-admitted carrier where an admitted one is required), or an endorsement your carrier won't issue can delay a signing or a closing. The fix is to read the insurance clause before you commit, place coverage that matches it, and use a broker who can turn a compliant certificate around quickly.
Can't find an answer to your questions? Reach out to our team →
Sources: Independent Insurance Agents & Brokers of America (the Big "I"), guidance on the ACORD 25 certificate (opens in a new tab); Seyfarth Shaw LLP, "Basics of Insurance Certificates for Lending Transactions" (opens in a new tab); Hillis Clark Martin & Peterson, "Insurance Certificates: Why Lenders and Landlords Want Them" (opens in a new tab); myCOI, "What Is a Loss Payee?" (opens in a new tab); Founder Shield, "Commercial Insurance Requirements from Landlords, Clients, and Investors" (opens in a new tab). This article is general information, not legal, financial, or insurance advice.