CERTIFICATES OF INSURANCE ACT TO TAKE EFFECT ON APRIL 10, 2016
By: Rafael L. Llano Esq.
A certificate of insurance is a document issued by an insurance company to verify the existence of insurance coverage. It provides information such as policy limits, policy number, named insured, and the policy's effective dates. Such certificates are widely used to supply proof of coverage required under a construction contract. However, a certificate only constitutes evidence of insurance; it is not an insurance contract. When there is a conflict between a certificate and the actual policy, the latter controls. Given these issues, there is a potential for fraud and abuse.1
On January 11, 2016, Governor Governor Chris Christie signed the Certificates of Insurance Act (S-3270/A-4705) into law.2 The new law will govern the use of certificates of insurance, making it illegal to present a certificate that contains false or misleading information. The presentation of a false or misleading certificate of insurance shall constitute a violation of the New Jersey Insurance Fraud Prevention Act, N.J.S.A. 17:33A-1 et seq. The law takes effect on April 10, 2016.
- Contractor in N.J. charged with having fake insurance certificate, Coalition Against Insurance Fraud, (July 31, 2013), http://www.insurancefraud.org/IFNS-detail.htm?key=16939#.Vrnz7vkrK70.
- http://www.njleg.state.nj.us/2014/Bills/S3500/3270_I1.PDF.