Tennessee Warns on Certificates of Insurance

Authorities in Tennessee are warning agents that certificates of insurance must be consistent with the underlying policy or they risk being penalized under state law.

The Tennessee Department of Commerce and Insurance recently issued a bulletin to clarify the use of certificates of insurance, which are governed by the state’s Unfair Practices and Unfair Claims Settlement Act of 2009. The act states that no document can “misrepresent the benefits, advantages, conditions or terms of any policy.”

Department Spokesperson Christopher Garrett said the department sent out the bulletin at the request of several insurance associations that complained that some business owners were requesting changes in their certificates that did not reflect the terms of the polices.

According to the department, such changes could result in an agent being subject to disciplinary action that could include a fine and a suspension of license.