Although various groups have been working on the issue of appropriate use, certificates of insurance and binders continue to be a hot-button issue for agents, insurers, certificate holders and state legislators.
The insurance industry uses ACORD or ISO forms to provide certificates of insurance to various entities: local and state governments, lenders and other businesses. These forms provide a courtesy synopsis of policy coverages and limits to these third parties.
Although most use standardized ACORD forms, many insurers use their own proprietary forms as well. Following the coverage issues that arose as a result of the 9/11 terrorist attacks, ACORD changed its certificate for commercial property insurance in 2005, adding wording to clarify that the form is "…issued as a matter of information only and confers no rights upon the certificate holder." Lenders objected to this clarification and, after 4 years of discussion without a consensus resolution, they were rebuffed as insurers voted to keep the clarifying language.
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