What can our insured do?

Maryland Subscriber

A

If the CGL form excludes the occurrence that caused the bodily injury, the certificate of insurance will not change that fact. The bottom line is that in most instances the language of an insurance coverage form takes precedence over language on a certificate of insurance, especially if there is conflict between the two items. Certificates of insurance mainly just provide information on the type and limits of insurance that are provided by the insurance policies indicated. For more information on certificates of insurance, see Certificates of Insurance.

There are court cases that you may want to review to help your insured understand that certificates of insurance should not be seen as insurance coverage policies. For example, in G.E. Tignall & Company, Inc. v. Reliance National Insurance Company, 102 F. Supp. 2d 300 (D. Md. 2000), the district court said that “ordinarily, the presentation of a certificate of insurance alone does not create coverage or legal duties; it is not a contract of insurance, but merely evidence that a contract has been issued.” As another example, in First Financial Insurance Company v. Jetco Contracting Corporation, 2000 U.S. Dist. LEXIS 10229 (S.D. N.Y. 2000), the court said the following: “as a general rule, where the certificate of insurance states expressly that it is subject to the terms and conditions of the policy, the language of the policy controls and the insurer may not be responsible for covering the third party;” and, “it is settled that a certificate of insurance is merely evidence of a contract for insurance.”

As these cases point out, in general policy language prevails over certificate of insurance language. This is the general rule, because if the certificate does not refer to the insurance policy, the certificate language governs the extent and terms of the coverage. A U.S. Circuit Court pointed this out in T.H.E. Insurance Company v. City of Alton, 227 F.3d 802 (7th Cir. 2000). So, you may want to read your insured's copy of the certificate to see the exact wording on the certificate.