Why wording on contracts and certificates matters

Contract language and Certificates of Insurance (COIs) don’t automatically change what your Commercial General Liability (CGL) policy covers. A COI is informational; coverage must exist in the policy and, when required, be added by endorsement. Courts and industry guidance in Canada consistently treat COIs as subordinate to the policy and its endorsements.

Quick definitions used in Canadian contracts

Additional Insured (AI): Extends some of the Named Insured’s liability coverage to a third party, typically “with respect to liability arising out of the operations of the Named Insured.” Scope depends on the exact endorsement wording and case law.
Primary & Non‑Contributory (P&NC): Makes one party’s policy respond first and prevents it from seeking contribution from the other party’s insurance. Commonly requested by Canadian municipalities and risk pools.
Waiver of Subrogation (WoS): The insured (and its insurer) waives rights to recover from specified third parties—usually only if required by a written contract and endorsed on the policy.

What a COI can and cannot do

Can: Evidence existing coverage and endorsements; satisfy a counterparty’s documentation requirement (e.g., municipalities requiring AI status shown on a COI).
Cannot: Grant coverage, make insurance primary, or waive subrogation by itself; those changes must be in the policy via endorsement.

Additional Insured: scope, pitfalls, and proof

What it does: Adds the AI to the Named Insured’s CGL for specified liabilities. If the endorsement says “arising out of the operations of the Named Insured,” Canadian courts have often read this broadly—sometimes reaching the AI’s own negligence if connected to the Named Insured’s work. Your exact endorsement text governs.
Where it lives: On a CGL endorsement, not just on the COI. COIs stating AI status are informational and don’t override the policy.
Common pitfalls: Relying on “arising out of” wording when only vicarious liability was intended; failing to include completed operations when required; assuming a blanket AI exists when the policy only schedules specific parties.
Evidence to request: The actual AI endorsement (or policy wording) in addition to the COI, especially for complex or high‑limit contracts.

Primary & Non‑Contributory: who pays first

What it does: Overrides “other insurance” provisions so one party’s policy responds first and doesn’t seek contribution from the other’s insurance. Canadian municipal risk authorities recommend this requirement to avoid priority disputes.
Where it lives: In a P&NC endorsement or policy wording that amends the “Other Insurance” condition.
Canadian practice examples: Municipal permit/film requirements frequently demand AI status, often alongside primary wording on the certificate and policy.

Waiver of Subrogation: when recovery rights are waived

What it does: Prevents your insurer from seeking recovery from the other party where a written contract requires it and the policy is endorsed. Many Canadian brokers note this generally must be agreed to in writing before loss.
Where it lives: On a WoS endorsement (e.g., modifying “Transfer of Rights of Recovery”) tied to the written contract; it is not automatic.
Cost/availability: Not all insurers offer WoS endorsements; availability and pricing vary by risk.

One‑page quick reference

Term	What it does	Where it must appear	Frequent pitfalls	Evidence to collect
Additional Insured	Extends some CGL protection to a third party	AI endorsement on CGL	“Arising out of” interpreted broader than intended; missing completed ops	Copy of AI endorsement + COI
Primary & Non‑Contributory	Sets priority; prevents contribution from AI’s policy	P&NC endorsement / other‑insurance modification	Only listed on COI without policy change; unclear priority among multiple AIs	P&NC endorsement text + COI
Waiver of Subrogation	Waives recovery rights against named party	WoS endorsement referencing written contract	Agreed after loss; not offered by some markets	WoS endorsement + contract page

Copy‑ready sample clause (use in your contracts; endorsements still required)

Insurance. The Contractor shall maintain Commercial General Liability insurance throughout the Term with limits not less than CAD $2,000,000 per occurrence, adding the Owner as Additional Insured with respect to liability arising out of the Contractor’s operations. Such insurance shall be primary and non‑contributory with any insurance maintained by the Owner. Where required by this Agreement, the Contractor and its insurer(s) waive rights of subrogation against the Owner to the extent permitted by applicable law. Evidence of coverage and endorsements shall be provided via certificate and copies of the endorsements upon request.

Notes: This sample clause is illustrative; counterpart endorsements must be issued by the insurer. COIs are informational and do not amend coverage.

COI request checklist (to avoid back‑and‑forth)

Legal names/addresses for all Additional Insureds.
Whether Primary & Non‑Contributory is required and for which policies.
Whether Waiver of Subrogation is required, and the exact contract section.
Completed/ongoing operations requirements and project/location details.
Any municipal form or wording required (e.g., film/event permits).

Get a certificate fast

Need a COI with contract wording today? Contact Summit—most standard COI requests can be turned around quickly, and we prioritize same‑day issuance where feasible. Request your COI or endorsements and we’ll confirm timing. Service available across Canada (excluding Quebec).

Start here: Commercial General Liability (CGL) insurance at Summit
Talk to us: Contact Summit

Sources and further reading

Canadian case and practice on Additional Insured scope and COI limitations.
COI disclaimers: examples of standard wording used in practice.
Canadian municipal/association guidance on AI and primary requirements.
Canadian broker insights on Waiver of Subrogation and timing.