Common COI Tracking Problems that a Certificate Of Insurance Management System Can Solve

COI Management | February 8, 2022

Over the years, we’ve found that there are a few consistent challenges amongst organizations when it comes to their certificate of insurance tracking. These involve a true understanding of their contractors’ compliance, timeliness in the renewal process, and cancellations. All these problems can leave you exposed. It is not uncommon for your organization’s risk manager or legal department to identify this as a potential weakness or, worse yet, leave your organization with the bill for denied insurance claims on your contractors’ insurance. Having worked with multiple clients on these challenges, we’ve found that there are some basic things you can incorporate and where a certificate of insurance management system can help. 

Compliance

When speaking with new clients, many of them express a concern that they do not understand where their network stands when it comes to insurance compliance. Often good numbers are provided to them but are quite frequently accompanied by symptoms, such as denied insurance claims and canceled policies, that reflect low compliance levels. It is critical to have overall and detailed compliance reporting that provides an accurate picture of where your contractors stand when it comes to not only having insurance but meeting your requirements. Tracking certificates of insurance is a form of risk management, which is the management of non-compliance. The first step is understanding your network’s non-compliance through accurate and timely reporting, allowing you to develop a plan if needed.
It is easy to think that you have a renewal process in place that will satisfy the management of non-compliance. However, your certificate of insurance management system should involve periodic reviews of your network’s compliance to ensure you are on track. There will always be providers who are non-compliant for various reasons. Perhaps you do not provide enough work for them to justify compliance, or they simply fall through the cracks. Your certificate of insurance management system should help you understand who in your network receives the most volume and highest risk work and ensure that they are compliant.  

Timeliness of Renewals

One of the biggest pain points is that the renewal process is not timely enough. This leaves you in a vulnerable state where work is being performed and the contractor is possibly not covered for insurance during that timeframe.  We frequently see that the management of the process is handled by multiple positions and departments. For example, a common scenario is that the field is responsible for collecting the certificate of insurance and then routing it to a compliance department for handling. It is important to review your process flow and ensure that extra steps and bottlenecks are eliminated or minimized. Our process is centralized and involves a direct connection with the insurance agent and the contractor by the team who is processing the insurance. They work directly to collect the certificate of insurance, reaching out for missing requirements and providing a single location for the certificate to be accessed when needed.
In addition to a centralized process, it is important to create a sense of urgency in submitting certificates and provide an incentive to do so. Our most successful programs involve system integrations where reporting occurs rapidly and rewards contractors who are timely with more work, creating a stronger relationship with your contractor and willingness to comply. 

Cancellations

The challenge in knowing when a policy has been cancelled is universal. There are extra steps that can be taken to ensure a higher likelihood of notification. The simplest is to ensure that you are a certificate holder and that the address matches that of the department or vendor who is responsible for your certificate of insurance management system. A high number of cancellation notices, especially by carriers who have automated systems, mail notifications to the certificate holder and additional insured’s address. Because mail is now an outdated mode for communication, collecting the mail and ensuring that the cancellations are processed is often overlooked. Our process actively manages and processes the mail daily so policies can be canceled in the system and the contractor can be notified.     
Our certificate of insurance management system also interacts with the agents to proactively inquire about policy status. In addition, working directly with the agent when it comes to compliance items is another way where agents can notify you of changes and cancellations to the policy. 
By reviewing these three areas, you can address them by reviewing your process and putting the right certificate of insurance management system into place.
Contents are provided for information purposes only and should not be construed as legal advice. Users are reminded to seek legal counsel with respect to their obligations and use of PlusOne Solutions services.
About PlusOne Solutions
PlusOne Solutions has been an industry leader in the risk management field by specializing in compliance programs that meet the complex challenges of geographically dispersed contractors, vendors, and employee networks. PlusOne Solutions protects companies from possible financial, legal, and reputational risks associated with contractor and vendor relationships while creating safer work environments. To learn more, visit our website.