Laserfiche WebLink
Why We Are Using the Latest ACORD 25 Certificate of Insurance <br />In September 2009, ACORD revised the ACORD 25 Certificate of Insurance form. One of the <br />major changes was the removal of the cancellation notice provision. For the following <br />reasons, we are unable to issue an older edition of this form or modify the current form. <br />•Notice of cancellation is a policy right, not an unregulated service. No insurer shown on this <br />certificate is able to provide the cancellation notice you desire by endorsement. For <br />example, the insured can cancel immediately, so it would be impossible for the insurer to <br />give you the notice you request. State law also grants the insurer the right to cancel for <br />reasons such as nonpayment with less notice than you require. <br />•For the reason just cited, if our agency were to issue a certificate that provides the <br />cancellation notice you request, we would do so with the full knowledge that it would be <br />impossible to actually give that amount of notice under certain circumstances. As such, the <br />certificate could be alleged to constitute a misrepresentation or fraud which could subject <br />our agency and staff to serious civil and criminal penalties. <br />•If a certificate purports to provide a policy right different from that provided by the policy <br />itself, then the certificate effectively purports to be a policy form. Policy forms must be filed <br />and approved by our state department of insurance. Use of nonfiled policy forms is illegal <br />and could result in legal sanctions distinct from the assertion that the certificate is <br />fraudulent. <br />•Under the ACORD Corporation’s licensing agreement, the prior editions of superseded <br />forms can be used for one year from the time the new forms are introduced. Beginning in <br />September 2010, this is another reason we cannot use an older edition of the ACORD 25. <br />Doing so would violate ACORD's licensing agreement and, as a copyrighted document, <br />federal copyright law. <br />•Likewise, we are unable to modify the new certificate to add a notice of cancellation. <br />ACORD forms are designed to be completed, not altered. ACORD's Forms Instruction <br />Guide says that a certificate should not be used "To waive rights... To quote wording from a <br />contract... To quote any wording which amends a policy unless the policy itself has been <br />amended." In addition, our insurance company contracts only allow us to issue unaltered <br />ACORD forms. <br />You may be interested in how the City of Atlanta, Georgia is now reportedly dealing with this <br />issue based on a very detailed study they conducted in 2008. Their report is available at the <br />following internet link: http://tinyurl.com/26guax8 <br />We appreciate your understanding of the legal restrictions on our ability to fully comply with <br />your request. <br />ACORD 25 Certificate Why Use.doc 1/12/11/sls <br />