Many times in the rush to close commercial real estate
transactions, we often contact the insurance broker to provide a “Certificate
of Insurance” which states that there will be a new owner, new lender or a true
additional insured party as a result of the transaction. The latest draft
of the “Acord Certificate of Property Insurance” states that:
This Certificate is issued as a
matter of information only and confers no rights
upon the Certificate holder. This Certificate does not
affirmatively or negatively amend, extend or
alter the coverage afforded by the policies below.
On the other hand, an “Endorsement” legally
changes the actual policy provisions by, for example, including
a new owner, lender or additional insured as beneficiary of the insurance.
My suggestion: ALWAYS
require an ENDORSEMENT and never
accept a Certificate in your transactions.
-Jerry Slusky
-Jerry Slusky