COIs are not contracts, and they are not guarantees of coverage. They are snapshots of insurance information at a moment in time. When reviewed manually or inconsistently, important details can be missed—especially when teams are juggling dozens or hundreds of active vendors. Many compliance issues only come to light after an incident occurs. By then, it’s often too late to correct missing coverage or enforce contract requirements. Identifying red flags early helps prevent gaps that can escalate into legal exposure or financial loss.
One of the most common—and most dangerous—issues is coverage that does not extend through the full contract period. A COI may appear valid at onboarding but expire mid-project.
Why it matters: If an incident occurs after coverage has lapsed, your organization may be left unprotected. Expired policies create silent gaps that often go unnoticed without continuous monitoring.
A COI may list insurance limits that fall short of contractual requirements. This can happen when vendors reuse older certificates or submit policies designed for smaller engagements.
Why it matters: In the event of a claim, insufficient limits may prevent full recovery of damages—leaving your organization responsible for uncovered costs.
Many contracts require vendors to name your organization as an additional insured. A COI alone does not guarantee that the endorsement exists or is properly worded.
Why it matters: Without a valid additional insured endorsement, your organization may not be protected under the vendor’s policy, even if a claim is related to their work.
Waivers of subrogation are often required to prevent a vendor’s insurer from pursuing recovery against your organization. These waivers are frequently missing, incomplete, or incorrectly documented.
Why it matters: Absent or incorrect waivers can increase your exposure to claims and litigation, undermining the intent of contractual risk transfer.
COIs issued by insurers with low or no AM Best rating introduce an additional layer of risk that’s often overlooked during manual reviews.
Why it matters: If a carrier lacks financial stability, there is a greater risk it may not be able to pay claims when needed—leaving coverage effectively meaningless.
A more effective approach combines consistency, automation, and real-time visibility. Modern compliance platforms can:
By standardizing how COIs are reviewed and tracked, organizations eliminate guesswork and reduce dependence on manual intervention.
Catching COI red flags early allows teams to address issues before work begins—or before coverage lapses mid-contract. Instead of reacting to problems after a loss occurs, organizations can enforce requirements proactively and maintain stronger risk controls.
When compliance processes are automated and centralized, red flags become visible signals rather than hidden liabilities.
Ebix Risk Compliance Solutions (RCS) automates COI intake, validation, and tracking across your entire vendor network. Using OCR scanning, rules-based validation, and real-time dashboards, RCS identifies compliance red flags quickly and consistently—without manual review. Automated alerts notify vendors of deficiencies, renewal reminders prevent lapses, and centralized visibility ensures your team always knows where coverage stands.
To learn more about Risk Compliance products or to speak to a representative, simply contact:
Sales : +1 949-428-7800 / 800-996-9964
