Certificate of Insurance
A document from an insurance company confirming that a contractor or subcontractor actually carries the insurance coverage, such as general liability, workers' compensation, and so on, that their contract requires.
Why it matters
A contract can require insurance coverage on paper without anyone actually confirming it exists. The certificate of insurance is the proof, and a general contractor who lets an uninsured subcontractor onto a jobsite is exposing themselves to real liability if that subcontractor causes damage or someone gets hurt.
On a real project
Before an electrical subcontractor is allowed on-site, the general contractor's office collects a current certificate of insurance confirming the sub carries both general liability and workers' compensation coverage at the required amounts.
Who this matters most to
A Contracts Administrator collects and tracks certificates of insurance for every subcontractor on a job, flagging any that lapse mid-project. A Safety Manager cares because an uninsured worker injured on-site becomes the general contractor's liability if that subcontractor's coverage was never actually verified.
Where this goes wrong
A general contractor's office lets a subcontractor start work while their certificate of insurance is still "pending," assuming it will show up before it actually matters. A worker from that subcontractor gets injured on-site before the coverage is confirmed, and the general contractor discovers the policy had actually lapsed weeks earlier, leaving the GC exposed to a claim the subcontractor's own insurance should have covered.