Guide

What your insurance auditor will ask for

Your own carrier audits you at the end of the policy term. Missing subcontractor certificates become your payroll — and your premium. Here is what to have ready.

For every subcontractor you paid, the auditor wants a certificate covering the dates the work was done. Anything you cannot evidence is typically reclassified as your own labor and charged at your rate.

Key takeaways

The audit is the cost most contractors meet first. No claim, no incident, nobody hurt — just a bill months later for subs whose coverage you could not evidence.
The dates are what get checked, not the existence of a certificate. A current certificate proves nothing about a job you paid for eight months ago. Keep the one that was in force then.
Keep the endorsement pages too, not just the certificate. They are what an attorney asks for if a claim ever follows, and by then the agent who issued them may not be reachable.
Subcontractor cost is the trigger. Whatever you paid out to subs is what the auditor reconciles against your certificates, so the record has to line up with your books rather than with your filing.

By the Sealinn team · 5 min read · Updated July 2026 · Written for general contractors

What the audit actually is

Your general liability and workers' compensation premiums are estimates. At the end of the term the carrier audits the real numbers — your payroll, your receipts, and what you paid subcontractors — and issues an adjustment. It is routine, and it is usually a document request rather than a visit.

The part that surprises people is how subcontractors are treated. A carrier's working assumption is that an uninsured sub is, for rating purposes, your labor: you directed the work, you paid for it, and their injuries or their damage would have landed on your policy. So the amount you paid them gets added to your rated exposure unless you can show they carried their own coverage while doing the work. That is one of four routes an uninsured sub reaches you by; this page is about the records that answer this one.

This lands even when nothing went wrong

There is no claim in this story. Nobody was hurt, nothing was damaged, the job closed out fine. The charge arrives because the paperwork was missing, which is why it catches out contractors who think of certificates as insurance against accidents rather than as accounting records.

What to have for each subcontractor

The list is short, and the second item is the one people miss:

A certificate of insurance showing general liability and workers' compensation, from the sub's insurer.
Covering the period the work was done. This is the whole game. A certificate issued last week says nothing about a job you paid for in March, and an auditor reconciling March payments will say so.
Matching the entity you paid. The name on the certificate and the name on the check have to be the same business. A certificate for a related company with a similar name is a gap.
Any workers' comp exemption evidence, where a sub legitimately had none — usually a state-issued exemption certificate rather than the sub's word. What to do when a sub says they're exempt covers which cases are real and what the state actually issues.

Keep the endorsement pages alongside the certificates. The auditor generally will not ask for them, but they are what your own carrier or an attorney asks for if a claim surfaces later — and reconstructing them years afterwards, from an agency that may no longer handle that account, is a materially worse day.

The gaps that actually show up

In rough order of how often they cause a charge-back:

A sub you paid once and never set up. The emergency call-out, the one-day repair, the favor. They are in the ledger and not in the filing cabinet.
A renewal that never arrived. You held a valid certificate at mobilization, the policy renewed mid-job, and the new certificate was never sent — so your file covers the first six weeks of a five-month job.
Only the current certificate on file. Common when certificates are stored by subcontractor rather than by date: each renewal quietly overwrites the evidence for the period you now need.
A certificate for the wrong entity. Usually innocent, and usually only visible when someone compares it against the payment record rather than reading it on its own.
An exemption taken on trust. The sub said they were exempt, everyone moved on, and no document was ever collected.

Keeping the record so it is there later

Two habits do almost all of the work, and neither needs software:

Never overwrite a certificate — add to it. Keep every version with the dates it covered. The one you replaced is the one that proves last spring.
Reconcile against payments, not against your filing. Once a year, list every subcontractor you paid and check each has coverage for the dates you paid them. Working from the ledger finds the one-off sub; working from the folder never will, because a folder is organized by whoever saved the file rather than by who you paid.
Store the endorsement pages with the certificate, not in a mail thread.
Write down what you decided in the odd cases. An accepted exemption, a permitted gap, a sub you allowed to continue — a dated note is the difference between a judgment call and an unexplained hole.

If you are doing this in a spreadsheet, our free template has date columns rather than a status column for exactly this reason — a status tells you about today, and an audit asks about last year.

If you are doing it in Sealinn, the shape the auditor wants is the per-subcontractor report rather than the org-wide one — everything on file for one company, which is the question being asked about each name on their list. What each report answers is worth reading before the appointment rather than during it.

If you are charged anyway

Audit findings are not final. If you can produce a certificate covering the period for a sub the auditor has flagged, carriers will normally revise the result — so it is worth asking the agent for a historical certificate before accepting a charge. That is a call to make with your broker, and a specific reason it should not have been counted, rather than a general objection.

The far cheaper version is to collect it before the work starts. What to require before a sub starts is the front end of the same problem, and how to verify a certificate is what makes the record worth keeping.

Where this comes from

NCCI — Countrywide workers' compensation forms and rules
Texas Department of Insurance, Division of Workers' Compensation — Employer information (Texas is the one opt-out state)
Internal Revenue Service — Independent contractor, self-employed, or employee
ACORD — Certificate of Liability Insurance (form 25)

The record, already assembled.

Sealinn keeps every certificate version with the dates it covered, and exports the whole history when someone asks for it.

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