The Office of General Counsel issued the following informal opinion on December 4, 2002, representing the position of the New York State Insurance Department.
Re: ACORD 25 and ACORD 27 Forms
Are ACORD-form type certificates of insurance valid evidence of an insurance policy and may they be amended to reflect said policy?
ACORD-form type certificates of insurance may be used only to provide evidence of insurance in lieu of an actual copy of the applicable insurance policy. They may not be used to amend, expand, or otherwise alter the terms of the actual policy.
No facts were presented. Although several questions were posed in the inquiry regarding specific ACORD forms, the following general discussion should be responsive.
ACORD-form type certificates of insurance can be used to provide evidence of insurance, in lieu of an actual copy of the applicable insurance policy. However, it is merely a document used in business to summarize information about insurance coverage. It is not a contract, it is not required by statute or regulation, and it is not required to be filed with the Department. Office of General Counsel Opinion dated 6/16/00. 1 It is not intended to confer on a certificate holder new or additional rights beyond what the policy provides. Certificates may not be used to amend, expand, or otherwise alter the terms of the actual policy.
A certificate of insurance that lists the pertinent coverage terms as they appear in the actual policy is not considered a policy form that requires the Superintendents prior approval. However, one that amends, expands, or otherwise alters the terms of the applicable policy constitutes a policy form, which must be filed with the Superintendent in accordance with N.Y. Ins. Law § 2307(b) (McKinney Supp. 2002).
Accordingly, licensed producers may not add terms or clauses to a certificate of insurance, which alter, expand, or otherwise modify the terms of the actual policy unless authorized by the insurer that has filed an appropriate endorsement with the Superintendent and obtained prior approval, if required. Circular Letter No. 8 (1995) and Circular Letter No. 15 (1997).
With respect to modifying the language in an ACORD form to expand notice of cancellation requirements, if the notice requirement is not contained in the policy, the modified ACORD form imposes an obligation or liability not presently existing upon an insurer. Consequently, there is by definition an altering, expanding, or modification of rights between an insured or additional insured and the insurer. With such a change in terms, a certificate of insurance would constitute a policy form that must be filed with the Superintendent. Office of General Counsel Opinion 5/11/02. 2
For further information you may contact Supervising Attorney Joan Siegel at the New York City Office.
1 Office of General Counsel Opinions are available on the Department web site, www.ins.state.ny.us.
2 Also see Office of General Counsel Opinions dated 1/22/2001 (#2) available on Westlaw and 6/16/2000(#2) available on the Departments web site and Westlaw.