By Patrick Turcotte, COO, Docutrax. Last reviewed: 25 August 2026.

Verifying a subcontractor's workers compensation coverage means confirming three things: that the coverage represented is in force, that the workers performing the job are covered under the applicable workers compensation law and policy, and that the evidence provided is the document the relevant jurisdiction recognizes for the purpose at hand.

Workers compensation is the line where that third question matters most, because several states prescribe their own forms or verification procedures. The result is that a certificate that looks perfectly familiar may not be the document that satisfies a particular state's legal or contractual requirement.

What a workers' compensation certificate establishes

An ACORD 25 is a certificate issued by a producer that reports the workers compensation and employers liability coverage represented to be in force for the named insured, subject to the policy terms and conditions. It identifies the policy number, policy period and applicable workers compensation and employers liability limits.

That is different from saying that the certificate itself creates or guarantees coverage. The ACORD 25 is issued for information only, confers no rights on the certificate holder, and expressly states that the limits shown may have been reduced by paid claims. The current form also states that the limits shown are inclusive of amounts requested by the certificate holder and may not reflect policy limits in excess of those requested.

What it does not establish by itself is whether coverage remains in force after the certificate was issued, whether every worker performing the job falls within the applicable coverage, or whether the certificate satisfies a particular state or contractual requirement. Those questions require additional verification.

Why the ACORD 25 is not always the accepted document

This is the part that most often surprises people who verify certificates across state lines.

New York is the clearest example. For government-issued permits, licenses and contracts, the New York Workers' Compensation Board states that ACORD forms are not acceptable proof of New York State workers compensation coverage under Workers' Compensation Law §57. The Board specifies the forms that may be used instead, including C-105.2, U-26.3, SI-12, SIG-105.2 and, where applicable, CE-200.

Two things are important here.

First, the New York rule applies in the context of Workers' Compensation Law §57, which governs government-issued permits, licenses and contracts. It is not a general ruling that an ACORD certificate has no value in New York for a private contractual relationship. Second, New York is an example rather than a national rule.

What travels is the principle: before deciding whether a workers compensation certificate is acceptable, establish what document or verification method the jurisdiction of the work recognizes for the particular purpose involved.

Employers liability is a separate coverage with its own limits

The workers compensation section of an ACORD 25 reports two related but distinct coverages, and contracts can require both.

Statutory workers compensation is identified through the PER STATUTE or OTH-ER designation. Employers liability is reported separately through three limits:

• E.L. EACH ACCIDENT

• E.L. DISEASE - EA EMPLOYEE

• E.L. DISEASE - POLICY LIMIT

Workers compensation provides statutory benefits to covered employees for compensable workplace injuries under the applicable workers compensation law. Employers liability provides protection to the employer against certain liability arising from employee injury that falls outside the workers compensation benefits system.

In construction, employers liability can become particularly important when an upstream party faces a claim arising from an injury to an employee of a subcontractor. But it is important not to treat every such claim as automatically falling within employers liability. Contractual indemnity, the terms of the subcontract, the employers liability coverage, and the applicable general liability policy can all affect where a particular claim may fall.

That distinction matters when reviewing a subcontractor's insurance.

A certificate showing statutory workers compensation coverage with the employers liability limits blank does not satisfy a contract that separately requires specified employers liability limits. The two coverages should be reviewed independently.

What the officer exclusion field is telling you

The same section of the ACORD 25 carries a selector asking:

ANY PROPRIETOR/PARTNER/EXECUTIVE OFFICER/MEMBER EXCLUDED?

A "Y" indicates that at least one proprietor, partner, executive officer or member is excluded from workers compensation coverage.

For a large subcontractor sending a conventional employee workforce to a project, that may not be significant.

For a small operation where the owner is one of the people who will actually be performing the work, it can be critical. The person doing the work may not have the workers compensation protection that the certificate's overall presentation might otherwise lead a reviewer to assume.

Whether an owner, officer, partner or member may be excluded, and the conditions under which that exclusion is permitted, are matters of state law and the applicable policy. The appropriate follow-up may therefore involve the subcontractor's broker or agent and, where available, the relevant state agency.

The practical question is simple:

Who is actually going to perform the work, and are those individuals covered?

What an exemption certificate does and does not mean

Some subcontractors will provide an exemption certificate rather than evidence of workers compensation insurance. That can be entirely legitimate, depending on the state, the business and the person claiming the exemption.

Florida, for example, directs contractors to obtain a copy of a subcontractor's certificate of exemption where the subcontractor has an exemption.

But an exemption is not insurance.

It evidences that the state has recognized a particular person or business as exempt from a coverage requirement. It does not create workers compensation coverage, and it does not extend the exemption to people who are not covered by it.

That distinction becomes particularly important where an exempt owner brings employees or other labor onto a project. The exemption may address the owner's status without answering the separate question of who covers the other workers.

Eligibility rules, scope and renewal requirements differ by state, so an exemption accepted in one jurisdiction should never automatically be assumed to satisfy the requirements of another.

New York provides an especially important example. The Workers' Compensation Board states that its Certificate of Attestation of Exemption, Form CE-200, may be used to demonstrate exemption to a government agency for the purposes covered by WCL §57, but may not be used to prove exemption to another business or that business's insurance carrier.

What changes in monopolistic states

North Dakota, Ohio, Washington and Wyoming operate monopolistic workers compensation systems in which workers compensation insurance is generally obtained through the state fund rather than through the competitive private insurance market.

That creates a different verification process.

The evidence of statutory workers compensation coverage comes from the applicable state system rather than from a conventional private workers compensation carrier. Employers liability is also a separate consideration because it is not included within the monopolistic state fund coverage.

The gap is generally addressed through stop-gap employers liability coverage, but the way that coverage is provided depends on the employer's operations and insurance program. It may be addressed through an endorsement associated with a workers compensation policy covering other states or through the general liability policy.

For a contractor, the practical point is this:

If a subcontractor is performing work in a monopolistic state and the contract requires employers liability coverage, do not assume that a state-fund workers compensation certificate answers the entire requirement. Verify how the required employers liability protection is provided.

A certificate showing statutory state-fund coverage and no separately displayed employers liability information is therefore not necessarily deficient. It becomes a deficiency when the applicable contract or risk requirement calls for employers liability coverage and that coverage has not been independently established.

Where workers' compensation is not mandatory at all

Texas is the outlier worth knowing.

Texas generally does not require most private employers to carry workers compensation insurance. Private employers can elect to participate in the Texas workers compensation system or become non-subscribers. Certain governmental entities and other employers are subject to different requirements.

For a contractor, this means a Texas subcontractor without workers compensation insurance may be operating lawfully in circumstances where the law does not require coverage.

That does not mean the exposure disappears.

It means the requirement may have to come from the contract rather than from the workers compensation statute. A contractor therefore needs to determine whether the subcontractor is a subscriber, a non-subscriber, or otherwise subject to a statutory requirement.

Public construction is different. Texas Labor Code §406.096 establishes specific certification requirements for governmental construction contracts, including requirements applicable to subcontractors.

Verifying a Texas subcontractor is therefore a different exercise from verifying a subcontractor in a state where workers compensation is generally mandatory. The first question may be whether the subcontractor carries workers compensation at all. The second is what the contract requires if it does not.

How to verify coverage independently of the certificate

The certificate is not the only evidence available.

Many states publish their own workers compensation coverage records or verification services. Where available, these can provide an important independent check against the certificate, particularly when the concern is whether coverage remains in force after the certificate was issued.

Texas, for example, provides public resources for checking workers compensation coverage and identifying certified self-insured employers and non-subscribers. Maryland provides a public coverage verification service, and states including North Carolina, Illinois, Iowa and Connecticut provide their own coverage search resources.

These databases should be treated as corroboration, not as a universal replacement for the underlying insurance documentation.

A state database can have reporting delays, search limitations or exclusions. Maryland expressly cautions that a failure to obtain a result does not necessarily mean that an employer has no insurance; it may simply mean that the information searched did not produce a match.

Searches generally work best when the subcontractor's exact legal identity is known. An exact FEIN, legal name and address can be materially more useful than a trade name or abbreviated business name.

Self-insured employers can also fall outside ordinary insurance-company reporting systems, which is another reason a database result should not be treated as conclusive in isolation.

NCCI's Proof of Coverage Inquiry is another example of why the verification route matters. Its service is intended for regulators, industrial commissions and accident boards rather than as a general contractor-facing public search tool. A state public lookup may nevertheless use NCCI data behind the scenes.

The practical rule is:

Use the database to corroborate the evidence, identify potential lapses and catch discrepancies. Do not assume that a database result, positive or negative, tells the entire story.

Why an uninsured subcontractor can become your exposure

In many states, workers compensation law can impose obligations on an upstream contractor when a subcontractor has not secured the required workers compensation coverage.

Florida provides a clear example.

Under Florida Statutes §440.10, where a contractor sublets part of its work, employees of the contractor and its subcontractors engaged in that work can be treated as employees within the same business or establishment for workers compensation purposes, subject to the statutory exceptions. The statute also addresses the contractor's obligation to obtain evidence of subcontractor coverage.

Florida's Division of Workers' Compensation puts the practical point plainly: contractors are required to make certain that subcontractors have the required workers compensation insurance before beginning work.

The important point is not that Florida's rule applies identically everywhere. It does not.

The important point is that in a meaningful number of jurisdictions, an uninsured subcontractor can create consequences for the contractor above it. Verification is therefore more than an administrative exercise. Depending on the jurisdiction, the evidence collected before work begins can become important evidence of how the contractor satisfied its own obligations.

The workers' compensation waiver is a separate endorsement

Where a contract requires a waiver of subrogation, the requirement needs to be examined against each policy to which it applies.

A workers compensation waiver of subrogation and a general liability waiver of subrogation are separate provisions associated with separate lines of insurance. A waiver shown for general liability does not automatically establish a workers compensation waiver, and the reverse is also true.

Whether a workers compensation waiver is permitted or enforceable can also depend on state law, with additional considerations in monopolistic workers compensation states.

The direction of the waiver is worth stating plainly.

Under a workers compensation waiver of subrogation, the subcontractor's workers compensation insurer agrees, subject to the terms of the endorsement and applicable law, to waive certain rights to recover from the organization identified in the waiver after paying a workers compensation claim.

It is an endorsement or policy provision associated with the subcontractor's workers compensation coverage.

A statement typed into the Description of Operations box on an ACORD certificate does not create that endorsement.

Likewise, a check in the SUBR WVD column on the general liability line says nothing by itself about the workers compensation waiver.

Each required waiver should therefore be verified against the applicable policy and endorsement.

When a certificate fails verification

Complete the whole review before responding.

A single deficiency notice identifying every issue in specific terms is usually more useful than three separate notices raised as each problem is discovered.

Specific means identifying:

• the form or evidence the jurisdiction requires;

• the employers liability limit the contract calls for;

• the legal entity name that should appear;

• the applicable workers compensation jurisdiction;

• any excluded officer, partner, member or proprietor who needs to be addressed;

• and any required endorsement or waiver that has not been established.

Remediation normally runs through the subcontractor's broker or agent, who can obtain the corrected certificate, endorsement or other required evidence from the carrier or state fund.

That chain is where much of the elapsed time sits, which is another practical reason to identify all deficiencies at once.

What happens while a deficiency remains open, and whether it affects site access, work start, payment or another business process, is ultimately the client's decision under its own approved procedures.

The compliance function's job is to surface the facts accurately, document what was verified and when, identify what remains unresolved, and coordinate the escalation the client has approved.

In summary

A workers compensation certificate is useful evidence. It is not the same thing as the policy, and it is not automatically the same thing as legally sufficient proof of coverage.

Good verification asks more than whether a certificate has been received.

It asks:

Who is covered?

Where are they covered?

Is the coverage actually required?

What does the jurisdiction recognize as proof?

What employers liability protection exists?

Are any owners or officers excluded?

Are required waivers actually endorsed?

And can the coverage be independently corroborated?

For contractors managing dozens, hundreds or thousands of subcontractors, those distinctions are not academic. They are the difference between collecting documents and actually understanding the risk those documents are supposed to represent.