Assurex E&O Plus | Have You Ever Had to Fix a Certificate?
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Have You Ever Had to Fix a Certificate?

20 Aug Have You Ever Had to Fix a Certificate?

Posted at 08:56h in Pearsall’s Perspective – E&O Plus Tip of the Week by

While it probably does not take much time to issue a Certificate of Insurance, it does take a fair amount of time to issue it correctly. Some recent E&O claim causes show certificates around 6-8%. The 6-8% is likely because the certificates were not issued correctly, and a loss occurred that divulged the error. So, one of the necessary takeaways from this topic is:

Issuing certificates is serious business. They need to be executed with a solid degree of accuracy.

There is no doubt that errors do occur in this process. Fortunately, the agency often discovers the error. Sometimes, it is the same day, the next day, or many days later. So what happens or what should happen? Essentially, the certificate must be replaced with one that corrects the error.

Typically, a certificate of insurance is issued out of the agency management system. When it is determined to be incorrect, a common question is basically, is there a way to indicate on the top of the “new certificate” that the “new” certificate is a “replacement” to the one previously issued? I admit I don’t know all of the capabilities/functionality of agency management systems, but initial research indicates this is not possible. Even if possible, I am not sure this is the best approach. The various parties may not see the language you included or understand why they are getting a “new” certificate. Noting something in the Description section is an option and while this might work, there is a better approach.

It is probably best for the agency to send an email advising them that the certificate was incorrect and not valid and that a new one will be issued shortly—essentially “voiding” the previously sent certificate. Then, a “corrected” certificate should be sent stating that the new certificate replaces the certificate issued (insert date). This communication and correspondence should be stored in the proper location in the client’s file in the agency system.

Mistakes do happen. It is what you do about them that makes the difference.