Certificate Of Insurance Requirements Explained: What Insurance Agencies Must Know

Every commercial contract with an insurance requirement section is a compliance test. The contract specifies what coverage the insured must carry, what limits apply, what endorsements must be in place, and who must be named on the policy. If the certificate of insurance does not match those requirements, the insured is in breach of contract before any loss occurs.

Certificate of insurance requirements exist to allocate risk. The party requiring the COI - a landlord, general contractor, or corporate vendor - is transferring financial exposure back to the insured and their carrier. Understanding what each requirement means, where it comes from, and how to verify it is a core competency for every agency handling commercial accounts.

Key Takeaways

• Minimum GL limits for commercial tenants typically run $1M per occurrence / $2M aggregate. Construction contracts commonly require $2M per occurrence / $4M aggregate.
• Additional insured status requires a policy endorsement. A certificate alone does not extend coverage - the ACORD 25 disclaimer states this explicitly.
• "Primary and non-contributory" is a separate requirement from additional insured status. It requires a specific endorsement (CG 20 01 or equivalent) and adds 3% to 10% to GL premium.
• Waiver of subrogation requires a policy endorsement, not just a certificate notation. ISO form CG 24 04 is the standard GL waiver of subrogation endorsement.
• Construction contracts commonly require both CG 20 10 (ongoing operations) and CG 20 37 (completed operations). Missing the completed operations form is a common COI error.

Why Contracts Specify COI Requirements

A contract's insurance requirements section is a risk transfer mechanism. The party with more bargaining power - the landlord, the general contractor, the corporate buyer - sets the minimum insurance floor and requires documentation that the floor exists.

Without COI requirements, a vendor or subcontractor could go bankrupt, carry no insurance, and leave the contracting party holding liability they did not intend to accept. COI requirements solve for three specific risks:

1. Third-party bodily injury and property damage. If a subcontractor's employee injures a third party, the general contractor wants the subcontractor's GL policy to respond first. The GL requirements in the contract set the minimum pool available.

2. Work-related injuries to the insured's employees. Workers' compensation requirements in contracts prevent an uninsured worker from suing the contracting party under premises liability theories in some states.

3. Named insured's contractual liability exposure. When the insured signs a contract, they often assume indemnification obligations. The GL policy must include contractual liability coverage (which standard ISO CGL policies provide under Coverage A) for the indemnification clause to be backed by insurance.

The certificate of insurance is the documentation that these requirements are met. The certificate is not the coverage. The coverage is in the policy and its endorsements.

The Most Common COI Requirements in Contracts

Minimum GL Limits

Commercial general liability minimum limits appear in nearly every commercial contract with a COI requirement. The standard structure is per-occurrence / aggregate:

The contract specifies whether the limits are per occurrence, per project aggregate, or general aggregate. Some contracts require "per project aggregate" endorsements (ISO CG 25 03) that reset the aggregate for each project rather than sharing one aggregate across all projects in the policy year.

Additional Insured Status

Additional insured status grants the named party coverage under the insured's GL policy for claims arising out of the insured's operations. It requires a policy endorsement. A certificate listing a party as additional insured without the corresponding policy endorsement is a misrepresentation and creates E&O exposure.

The ISO endorsement forms most commonly required:

• CG 20 10: Additional Insured - Owners, Lessees or Contractors - Scheduled Person or Organization (Ongoing Operations)
• CG 20 37: Additional Insured - Owners, Lessees or Contractors - Completed Operations
• CG 20 11: Additional Insured - Managers or Lessors of Premises (for landlord-tenant relationships)
• CG 20 26: Additional Insured - Designated Person or Organization (general additional insured, common in vendor agreements)
• CG 20 33 / CG 20 38: Blanket additional insured endorsements covering all parties the insured has a written contract with

Construction contracts frequently require both CG 20 10 and CG 20 37 together. CG 20 10 covers ongoing operations; CG 20 37 covers completed work after the project ends. A subcontractor with CG 20 10 only leaves the general contractor exposed to post-completion claims.

Primary and Non-Contributory

Standard additional insured endorsements make the insured's policy share liability with the additional insured's own coverage. A "primary and non-contributory" requirement changes that: the insured's policy must respond first without seeking contribution from the additional insured's coverage, even if the additional insured has their own policy that could apply.

Primary and non-contributory language appears in contracts as: "Coverage afforded to the Additional Insured shall be primary and non-contributory with respect to any other insurance or self-insurance maintained by the Additional Insured."

This requires endorsement ISO CG 20 01 (Additional Insured - Primary and Non-Contributory) or equivalent. Without the endorsement, the policy will invoke "other insurance" clauses and share liability on a pro-rata basis - the opposite of what the contract requires.

Waiver of Subrogation

Subrogation is the carrier's right to sue a third party that caused a loss after the carrier pays the claim. A waiver of subrogation endorsement eliminates that right for a specified party.

A landlord requires a tenant's waiver of subrogation to prevent the tenant's carrier from suing the landlord after paying a property damage claim caused by a landlord's negligence. A general contractor requires subcontractors' waivers of subrogation to prevent subcontractor carriers from pursuing the GC after paying workers' comp or GL claims.

ISO CG 24 04 is the standard GL waiver of subrogation endorsement. ISO WC 00 03 13 is the workers' comp equivalent. Both require policy endorsement. A certificate notation in the "Description of Operations" field that says "Waiver of subrogation applies" does not create a waiver without the underlying endorsement.

Specific Endorsement Form Requirements

Some contracts specify the exact ISO form number required. This matters because ISO endorsement editions have changed over time and the coverage scope differs by edition.

A contract requiring "CG 20 10 10 93 or equivalent" is asking for the 1993 edition of the additional insured endorsement, which was broader than the 2013 edition (CG 20 10 04 13). Carriers no longer issue the 1993 edition. A certificate claiming compliance with a 1993-edition requirement when the policy has a 2013 edition creates a documentation gap that can result in coverage disputes.

Industry-Specific COI Requirements

Construction

Construction contracts carry the most detailed COI requirements of any industry. A typical subcontract requires:

• GL: $1M / $2M minimum with CG 20 10 + CG 20 37 naming the GC and project owner as additional insureds
• Primary and non-contributory endorsement
• Waiver of subrogation on GL and workers' comp
• Workers' comp: statutory limits with employers' liability $500K / $500K / $500K
• Commercial auto: $1M combined single limit
• Umbrella: $2M minimum excess over all underlying policies
• "Per project aggregate" endorsement on GL (CG 25 03)
• Notice of cancellation: 30 days (10 days for non-payment)

Failing to meet any one of these requirements puts the subcontractor in breach before work starts. GCs should not allow work to begin without a complete, verified COI package.

Commercial Leases

Commercial leases typically require the tenant to name the landlord as additional insured using CG 20 11 (Managers or Lessors of Premises). The blanket additional insured endorsement works if the lease is in writing and triggers blanket coverage.

Commercial lease COI requirements commonly include:

• GL: $1M / $2M per occurrence / aggregate (higher for restaurants, retail)
• Additional insured: landlord named using CG 20 11 or equivalent
• Loss payee status for the landlord on property coverage (if tenant insures fixtures)
• Waiver of subrogation on GL and property
• Business interruption coverage (some institutional landlords require 12 months of rent)
• Notice of cancellation: 30 days

The certificate of property insurance (ACORD 24) is used alongside ACORD 25 when the contract requires documentation of property coverage. Property COI requirements include the landlord as loss payee or additional insured on the property policy.

Vendor Agreements

Large retailers and corporate buyers use master vendor agreements with standard insurance requirements. These requirements are typically non-negotiable and include:

• GL: $2M / $4M with CG 20 26 naming the retailer as additional insured
• Primary and non-contributory
• Waiver of subrogation
• Products-completed operations coverage in a separate aggregate
• Workers' comp and employers' liability
• Umbrella: $5M or higher (Walmart, Target, and Amazon-type agreements typically require $5M to $10M umbrellas)

Corporate vendor agreements often require the COI to be issued within 5 to 10 business days of contract execution and renewed 30 days before expiration. Failing to renew a COI on time is a default under many vendor agreements that can result in payment holds.

How to Read a Contract's Insurance Requirements Section

Most contracts place insurance requirements in a standalone section titled "Insurance" or "Insurance Requirements" near the indemnification clause. The section typically includes:

1. Required coverages: List of required lines (GL, auto, workers' comp, umbrella, professional liability if applicable)
2. Minimum limits: Per-occurrence and aggregate amounts for each line
3. Endorsement requirements: Specific ISO forms or equivalent language for additional insured, primary/non-contributory, and waiver of subrogation
4. Certificate holder designation: Name and address of the party to receive the COI
5. Notice of cancellation: Required days of advance notice before cancellation or material change
6. Financial rating requirements: Some contracts require carriers with AM Best ratings of A- VII or better

Read every word of this section. The words "occurrence" vs. "claims-made" determine whether the form requirement is met. A GL contract requiring "occurrence form" cannot be satisfied with a claims-made policy.

If the contract is ambiguous - for example, if it says "name [party] on the policy" without specifying additional insured - confirm with the client and the contract counterparty before issuing the certificate. Ambiguity resolved wrong creates E&O exposure.

What Happens When a COI Doesn't Meet Contract Requirements

The insured is in breach of the contract's insurance requirements section from the moment coverage is insufficient or documentation is missing. The consequences depend on the contract type:

Commercial leases: The landlord can terminate the lease for breach of the insurance covenant. Some leases give the landlord the right to purchase the required coverage and bill the tenant for the premium.

Construction subcontracts: The GC can stop work and bar the subcontractor from the site. The subcontractor loses the contract and potentially faces damages for project delay.

Vendor agreements: The corporate buyer can suspend payment and terminate the vendor agreement. Recovery of prepaid amounts may also be possible.

Beyond contract breach, the insured faces an insurance gap. If a loss occurs while the COI requirements are not met, the additional insured who was supposed to be covered may have no policy to tender to. They will sue the insured for breach of the contractual insurance obligation and may also pursue the agency for E&O if the certificate represented coverage that did not exist.

How Agencies Should Review Contract Insurance Requirements Before Issuing

The correct workflow:

1. Get the contract section before issuing. Ask the client to send the insurance requirements section from the contract, not just a verbal description.

2. Compare requirements to the current policy. Check each requirement: Are the limits met? Does the policy have the required additional insured endorsement? Is the correct ISO form on the policy? Is there a primary/non-contributory endorsement? Is there a waiver of subrogation endorsement?

3. Flag gaps before issuing the certificate. If the policy does not meet the contract requirements, contact the account manager. Process the required endorsements before issuing the certificate.

4. Issue the certificate accurately. Only mark the boxes that correspond to actual policy endorsements. Do not mark additional insured if the endorsement does not exist.

5. Document the review. Save the contract requirements section, the policy endorsement review, and the issued certificate together in the client file. When a coverage dispute surfaces two years later, documentation proves the certificate matched the policy.

BrokerageAudit's COI Manager automates this workflow by tracking every certificate against the current policy endorsements and flagging mismatches before issuance.

For details on COI tracking for high-volume accounts, see our COI workflow guide and certificate management best practices.

Frequently Asked Questions

What are the most common COI requirements in commercial contracts?

The five most common requirements are: (1) minimum GL limits of $1M per occurrence / $2M aggregate, (2) additional insured status for the contracting party using ISO CG 20 10 or CG 20 26, (3) primary and non-contributory language requiring ISO CG 20 01 or equivalent, (4) waiver of subrogation using ISO CG 24 04, and (5) 30-day notice of cancellation. Construction contracts add CG 20 37 (completed operations) and per-project aggregate endorsements.

What happens if an insured's COI doesn't meet contract requirements?

The insured is in breach of the contract's insurance covenant immediately. The consequences range from work stoppages (construction) to lease termination (commercial leases) to payment suspension (vendor agreements). If a loss occurs while requirements are unmet and the additional insured cannot recover from the insured's policy, the insured faces contractual breach damages and the agency faces E&O exposure for any certificate that misrepresented the coverage.

Who sets the COI requirements in a contract?

The party with more bargaining power sets the requirements - typically the entity hiring or contracting with the insured. Landlords set tenant requirements. General contractors set subcontractor requirements. Large corporate buyers set vendor requirements. Risk managers at larger organizations draft standard insurance exhibit templates that apply to all vendors and subcontractors. These requirements are often non-negotiable for the insured.

What is the difference between primary and non-contributory and standard additional insured status?

Standard additional insured status extends coverage to the additional insured but allows the insured's policy to share liability with the additional insured's own coverage under "other insurance" clauses. Primary and non-contributory status eliminates that sharing - the insured's policy must respond first without contribution from the additional insured's own coverage. Primary and non-contributory requires a separate endorsement (CG 20 01 or equivalent) and adds 3% to 10% to GL premium.

Do construction contracts require both CG 20 10 and CG 20 37?

Most construction subcontracts require both. CG 20 10 covers liability arising from ongoing operations while the work is being performed. CG 20 37 covers liability arising from completed operations - claims that surface after the project is finished. Construction defect claims frequently arise 1 to 3 years after project completion. A subcontractor with only CG 20 10 leaves the GC and project owner without completed operations coverage from that sub's policy.

How should agencies verify that a COI meets contract requirements?

Get the contract's insurance requirements section before issuing. Compare every requirement to the current policy: limits, endorsement forms, carrier ratings. Check that the additional insured endorsement exists on the policy (not just on the certificate). Verify waiver of subrogation is endorsed onto the policy, not just noted on the certificate. If the policy does not meet the requirements, process the necessary endorsements before issuing the COI. Document the review in the client file.

Written by Javier Sanz, Founder of BrokerageAudit. Last updated April 2026.

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