A New Liability Certificate of Insurance – The Hits Just Keep Coming

Written by E. Stuart Powell, Jr., Insurance and Risk Management Consultant.

ACORD has produced a newly revised COI form, 2025/12. The major changes address a recurring question: which limits of insurance should be displayed on the COI?

The practical issue for producers is simple: when the policy limits are higher than the contractually required limits, the COI can appear to either overstate what the contract requires or understate what the policy provides. The revised ACORD wording appears designed to address that tension.

That tension appears most often when the policyholder’s insurance limits exceed the limits specified in a contract or agreement. For instance, a CGL policy could provide limits of $2 million per occurrence and $4 million in the general aggregate. The policyholder could then enter into a contract requiring minimum limits of $1 million per occurrence and $2 million in the aggregate. So, which limits should be shown on the COI?

Most E and O geeks have consistently taken the position that the COI reflects the insurance policy, not any third-party contract. The competing pressure comes from policyholders, who frequently ask producers to show only the limits required by the third-party contract rather than the full available policy limits. Some ISO Additional Insured endorsements even include provisions that restrict coverage for the additional insured to the required limits. Risk managers and attorneys are responding to those endorsement provisions by stating in third-party contracts that the stated limits are minimums and that they expect to share any limits above those minimum requirements. What’s a producer to do?

The new COI adds this wording: “Limits shown are inclusive of amounts requested by the (COI) holder and may not reflect policy limit amounts in excess of those requested.” (Parentheses added) In practical terms, that language appears to allow producers to show the contractually required limits on the COI rather than the full available policy limits. It also functions as a disclaimer in situations where an attorney previously could have argued that showing COI limits lower than the policy limits was a misrepresentation for which the producer-issuer of the COI was negligent. This may reduce the E and O potential.

The agency’s policy should remain straightforward: the COI should represent the insurance policy, not an external contract or agreement. It is suspected that most of us E and O geeks will maintain our standard position on this issue. The COI is a representation of some of the information on the Declarations Page of the insurance policy. Consequently, no external contract or agreement should influence the representation of the amounts of insurance stated in the insurance policy.

That said, the revised wording may matter most when the preferred policy position runs into practical business pressure.

However, the real world is a rough-and-tumble place. Sometimes policyholders make significant demands. This new wording on the COI may give a producer-issuer some protection. But additional protection may come from giving the policyholder a notice that explains the potential risk of an alleged misrepresentation or states that the third-party contract may make the understatement of the limits of insurance irrelevant if something goes boom in the night.