Certificates of Insurance in Texas

A certificate evidences a policy, never creates coverage

A certificate of insurance is a one-page form proving a Texas business carried the policies named on it on the day the form was issued. The certificate is evidence of insurance, and Texas Insurance Code §1811.051 bars it from altering, amending or extending the policy it names.

Three parties appear on every certificate: the insured business, the insurer that wrote each policy, and the certificate holder that asked for the proof.

A certificate is issued by the agency that placed the coverage, not by the business itself. Texas Insurance Code §1811.101 requires the form to be filed with and approved by the Texas Department of Insurance, and the approved form either carries the words for information purposes only, or states instead that the certificate confers no rights beyond the policy it names and that the policy terms control.

What a Texas certificate of insurance cannot do

A certificate of insurance changes nothing about the coverage it describes. The policy is the contract, and the certificate is a snapshot of that contract on one date.

What a certificate cannot do:

• Add a coverage the policy does not carry, because Texas Insurance Code §1811.051 bars a certificate from amending or extending the policy
• Oblige the insurer to notify the certificate holder of a cancellation, unless the policy itself carries that endorsement
• Keep coverage in force past the expiration dates printed on the form
• Name a party as an insured, which takes an endorsement on the policy instead

A certificate is proof, never coverage. A Texas contract requiring additional insured status, a waiver of subrogation or primary and non-contributory wording is asking for endorsements, and the certificate only reports that those endorsements exist.

What a certificate of insurance shows

A certificate of insurance lists each policy by line, insurer, policy number, term and limit, which is what a customer or a landlord reads before letting work start.

What a certificate holder checks:

• The named insured, spelled exactly as the contract spells the business
• The policy period, because coverage ends on the expiration date whatever the certificate says
• The limits for each line, matched against the limit the contract requires
• The description of operations box, which names the job, the project number or the lease
• The endorsement boxes, which report additional insured and waiver of subrogation status

The description of operations box is where most Texas certificate disputes start. A general contractor asking for a project-specific certificate will reject one that names no project.

Who the certificate holder is

The certificate holder is the party that asked for proof of insurance, and the name in that box is the only party the form is addressed to.

Who usually asks a Texas business for one:

• A general contractor, before a subcontractor is allowed on site
• A landlord, at lease signing and again at every renewal
• A customer, under a master services agreement or a purchase order
• A licensing authority, or a public owner on a government contract
• A lender or a lessor on financed equipment

Certificate holder status carries no rights under the policy. A party that needs rights under the policy needs an additional insured endorsement, which is a change to the policy rather than a line on a form.

When a Texas contract asks for more than a certificate

A Texas insurance clause usually asks for four things at once, and only one of them is the certificate.

What a clause typically requires:

• A certificate of insurance evidencing the lines and the limits
• An additional insured endorsement extending the policy to the other party
• A waiver of subrogation, giving up the insurer’s right to recover from that party after it pays
• Primary and non-contributory wording, putting the business’s policy ahead of the other party’s

Each of the last three is an endorsement the insurer has to agree to, and an insurer that declines one leaves the business short of the clause whatever the certificate says. General Liability Insurance in Texas sets out the coverage those endorsements attach to.

What to have ready when requesting a certificate

A certificate request moves in one pass when the agency has the exact wording the contract uses.

What to send with the request:

• The legal name and address of the certificate holder, copied from the contract
• The insurance clause itself, including every limit and endorsement it names
• The project name, address or number for the description of operations box
• The deadline, and whether the holder wants the certificate by email or through a portal
• Any waiver of subrogation or primary and non-contributory language quoted in the contract

Aulona Insurance Group issues certificates for the policies it places. A certificate for a policy placed somewhere else comes from the agency that wrote it, because the issuing agency is the one holding authority on that policy.

Where Aulona Insurance Group is not the right fit

Aulona Insurance Group issues certificates only for coverage it can place, and the agency’s package lines are a business owners policy, general liability, commercial property and professional liability.

Classes with no market on those package lines:

• Roofing and siding, a no-market problem rather than a pricing one
• Night clubs, gas stations, towing operators and auto dealerships
• Hospitals and physician practices
• Marijuana and cannabis businesses
• Used-goods dealers and non-durable goods wholesalers
• Livestock operations and pet breeders

Commercial auto sits outside those package lines, and a certificate that has to show commercial auto is a question for the recorded call with Luka Cenaj. Contractor Insurance in Texas and Texas Business Insurance set out the rest. Life, health, Medicare and disability coverage are not written at all.