Is COI Tracking Software Worth It?

You know that last-minute scramble before the start of a new job. Working under intense pressure to have legal agreements in place, you might wonder is COI tracking software worth it? COI tracking software is worth it when the hours your team spends chasing and reviewing certificates, plus the cost of one missed gap, add up to more than the subscription. That tipping point comes sooner as your partner count and project volume grow.

No one denies the vital process of checking third-party insurance coverage. If there are gaps, you could face legal and financial consequences. You’re doing the cost-benefit analysis of double-checking certificates of insurance to support the strong verification work your team already performs. 

Your staff generally fares pretty well even during busy construction seasons. You manage with that manual tracking system, relying on a familiar spreadsheet — although no one trusts it anymore. You rarely face a missed renewal, but those times you do cost your company money and reputation loss. 

Key Takeaways

• A COI shows coverage on the date it was issued, not that it’s still active.
• Manual tracking costs a construction manager about $13,000 a year at one hour a day.
• Partner count, lapse frequency and team size tell you when you’ve outgrown a spreadsheet.
• Use the ROI Calculator to see your own number.

What Is COI Tracking Software?

A certificate of insurance (COI) is a one-page summary of a partner’s policies. It shows the coverage in place on the date it was issued. It doesn’t prove the policy is still active or that the endorsements your contract requires are attached. COIs are how you determine whether your vendors have the right insurance, and enough insurance, for an upcoming job.

COI tracking software goes a step beyond confirming receipt of COIs. It helps determine whether third party vendors are in full compliance. COI tracking software:

• Collects certificates
• Checks COIs against job, company, and individual contract requirements
• Flags coverage gaps and shortfalls
• Alerts to expirations 

The software is therefore helpful at all stages of the vendor relationship: from when a new project gets off the ground to when delays and extended timelines necessitate an insurance coverage renewal.

How Manual COI Tracking Actually Costs You

The costs of manual COI tracking can seem invisible, but there’s a real impact on the bottom line of your business. 

There’s the relationship cost of bothering vendors, asking them for COIs in the face of delays or slow movement to gather documentation. This puts pressure on your team, causing friction before a project even starts. 

The money factor is also real. Your team is already stretched thin, especially during construction season. But the cost of inadequate insurance can be even greater.

The Time Cost

Consider that the median pay for a construction manager is $55.28 per hour. If they spend just one hour a day playing phone tag with vendors, sending emails, updating correspondence, and reviewing coverage details, it costs your company $276.40 a week, or about $12,990 a year across 47 working weeks.

The time of a construction manager might be better spent on other duties, including responding to work delays, emergencies, and monitoring safety on worksites.    

The Risk Cost   

The biggest cost of manual COI tracking is when hardworking staff overlook an insurance gap. The risk exposure of a single uninsured contractor on site can cost your company thousands of dollars.

The financial impact depends on your current procedures and vendor volume. For an individualized analysis, you can run a calculation of your cost of COI compliance. 

Signs You've Outgrown Manual Tracking

Transitioning to COI software also uses financial resources. So, although there are costs of manual tracking, you should also assess several factors to answer the question, “is COI tracking software worth it?”

The first step is a self-check. Consider these elements of your manual tracking process:

• Vendor count
• Frequency of certificate lapse
• Number of team members involved in COI tracking

Sixty-nine percent of builders use between 11 and 30 subcontractors in just one single-family home project, according to a National Association of Home Builders (NAHB) survey from 2020. Even a small builder may work with dozens of third-party partners

Review your manual tracking, and think about:

• Is your project volume increasing?
• Are you working with more vendors?
• Is your administrative and management team staying the same size?
• Does your team have confidence in the accuracy of the current system?
• Could your business handle the financial and reputational hit of an uninsured incident?

If there’s increasing pressure on your team to verify insurance, you might consider doing a cost-benefit analysis of COI tracking software.   

What Does COI Tracking Software Cost?

COI tracking software pricing varies, with companies having a range of price points and functionality options for COI tracking software. Price ranges depend on vendor volume and software features.

• Most platforms price by the number of third-party partners you track and what gets reviewed. Some only check certificates. Others read the endorsements behind them, which takes more work and catches more gaps. Integrations and human review add-ons also move the price. Ask each platform for a quote at your partner count, and compare it to your own manual cost, not to a list price.

The market therefore caters to almost every size of operation. Weigh these options against the current costs and potential risk of your current manual tracking. 

How to Calculate Your Own ROI

Look at the figures to answer, “is COI tracking software worth it?” Depending on your operation, it might make more sense to stay with manual tracking. 

Here’s a simple formula you can use:

Manual processing cost + Realistic risk exposure = Total manual tracking cost

Then compare your total manual tracking cost to software cost. 

The illumend ROI Calculator runs this for you from your partner count and review volume.

What to Look for Before You Decide

Finding a good software fit for your business goes beyond vendor count. Before assessing the cost differential, review the criteria that separate a good fit from a bad one. 

Usability

Transitioning from a manual COI tracking process to a new software takes some time and team member training. Consider how the new software will change your current workflow in all aspects, not just certificate of insurance tracking and review. 

A new platform that requires a complete overhaul of your vendor relationship processes might not be worth the cost or burden on your staff. Take a close look at compatibility with your existing technology, including vendor information systems and procedures.   

Some COI platforms offer intuitive, easy-to-navigate user interfaces that your staff can adopt quickly. Others might require levels of training and support from IT teams. 

Consider what the platform offers for transition support and whether adoption of the new system will pose an unnecessary challenge to your team. 

Coverage types tracked

It’s vital that COI tracking software can handle the coverage types central to your business. A sophisticated platform with AI review should be able to do a compliance review of relevant policies — but not if those policy types are unknown to the software. 

Do a quick check for compatibility for policy types like:

• General liability
• Workers compensation
• Auto liability
• Umbrella and excess coverage
• Builders risk insurance
• Inland marine insurance
• Professional liability errors and omissions

A COI tracking software might have levels of customization that allow you to add policy types as your business expands. During the evaluation process, review what the software can do now and how your options for functionality could grow in the future. 

Certificate review process

All COI tracking software will review certificates. Most will highlight that their platform is AI-powered. However, there can be big differences in how platforms use AI. This leads to differences in time and accuracy of the process, as well as when human oversight comes in.

Consider the distinction between AI-first and human-first COI models. Both use AI for review but a human-first model requires your team member to be the primary reviewer. In a human-first model, AI supports and provides a backup check for compliance. 

In an AI-first model, the AI handles the bulk of the review and compliance check. It leaves human oversight to non-routine, edge cases or spots of uncertainty. In an AI-first model, AI is the main driver of the review instead of the backup.

AI-first models return a compliance decision in minutes and read every certificate the same way. When coverage is non-standard, a person looks closely and decides. For those cases where coverage is non-standard or a case unique, there’s room for a person to look closely at the COI and determine if a gap exists.

Choosing the right certificate review process is largely individual, depending on your company workflow, team members, vendor relationships, and personal comfort level. As you consider software options, ask about what “AI-powered” really means.  

Third-party partner involvement 

Think about how you receive COIs. In a manual tracking process, you likely receive them by email — or even fax, snail mail, or in-person drop off. The process of entering COIs manually into your tracking system takes time and detailed attention from your staff.

COI tracking software can relieve this administrative burden. How much depends on the functionality of the specific software. Some options offer a portal where vendors can upload insurance documents directly. This eliminates the need for email correspondence and moving the information into the tracking and review software.

Choosing COI tracking software with a vendor portal is another largely individual decision you can make based on business and relationship needs. For some, the chance to engage with vendors over routine matters like insurance is another opportunity to build rapport and communication. These businesses might prefer to not have a portal. 

Some companies, on the other hand, prefer to eliminate the sometimes awkward interactions from follow-up calls and emails as they chase down missing certificates. For these operators, the friction-free and efficient process of online uploading and automated reminder notices is the best way to support vendor relationships. 

Renewal process

Long-term vendor relationships or long-term, multiphase projects might require several insurance renewals. As with other aspects of COI tracking software evaluation, you can choose a more hands-on or hands-off approach depending on preference and business needs.

A full-service, AI-powered, AI-first model might handle routine renewals automatically. The system can flag upcoming expirations and reach out to third-party partners so they can renew coverage early. For a side-by-side of the main platforms, see our guide to the best COI tracking software.

The AI can also flag when claims, changes in project specifications, and risk assessment analysis might mean the renewal needs closer evaluation. It can then prompt the essential check of a human eye. 

Operators might opt for a human-first approach to renewal processes, especially if there have been significant changes in the vendor relationship since the COI was first approved. If your company requires higher coverage limits, you might want the one-on-one discussion to happen with a valued vendor. 

You might also prefer to have an automatic, efficient process where term changes are clearly outlined for objective evaluation by the vendor. When discussing needs with software vendors, ask on what basis the COI tracking software makes its own decisions, and when it will come back to your team to take the lead. 

Where illumend Fits Into That Decision

illumend, from myCOI, is built for teams that want the efficiency of AI-powered COI tracking with the satisfaction of knowing renewals are handled correctly. 

illumend uses a four-part process to gather, review, and approve COIs. It proactively handles renewals, so your team can feel confident that vendor outreach happens early enough for smooth and friction-free updates. 

Lumie, the AI expert inside illumend, was built by the team behind myCOI and its 16 years in compliance. Lumie reads each certificate and the endorsements behind it against your contract requirements, then makes the compliance call. Your team signs off.

As documents come into Lumie, the platform gives plain-language answers about the process. It’s easy to see the stages of compliance, spot the gaps, and know what to do next in the case of discrepancies. 

There’s no portal or login for third-party partners, so you keep your system entirely in-house, while taking advantage of the sophistication, speed, and efficiency that automation brings.

Lumie follows up with partners and their brokers until gaps close, and logs every interaction.

This eliminates email chains and old-fashioned telephone tag. Review happens in one cycle. 

illumend also accomplishes something your human team might not: an assessment of patterns of risk that surface over time. This assessment can help you make the call about whether to change your vendor relationship or modify insurance requirements on each project. 

illumend helps you feel at ease with your risk coverage, without having to become an expert on insurance.   

See What This Looks Like for Your Team

COI tracking is essential to your business' bottom line. But it’s not just about risk and the costs of assessing legal contracts. Insurance tracking can directly impact vendor relationships. Companies that work with dozens or even hundreds of vendors at any time might benefit from the assistance of a guided tool that reduces risk and saves your team time”

Run your numbers in the ROI Calculator, or schedule a demo to see it in your workflow.

Frequently Asked Questions About COI Tracking Software

Here are some answers to the most frequent questions about tracking and review software for certificates of insurance.

Is COI tracking software worth it for a small business with only a few vendors?

COI tracking software vendors offer free tier options for operators with fewer than 25 vendors. Some businesses might find the technology helps to improve efficiency through automated renewal reminders and saves staff time. 

However, other small companies might prefer the hands-on approach of manual COI tracking that allows for more one-on-one vendor interaction and requires no retraining on a new software platform. Performing a cost comparison between the right COI tracking software option and your current expenditures and risk is one way to determine if it’s worth it. 

How much does COI tracking software cost?

Pricing usually scales with the number of third-party partners you track and whether the platform reviews endorsements as well as certificates. illumend doesn’t publish list prices, so the ROI Calculator estimates your return from your own volume.

What's the difference between COI tracking and full insurance verification?

COI tracking is the process of receiving, reviewing, and verifying that the certificate of insurance meets company requirements. Full insurance verification confirms that the COI is legitimate and the coverage in the actual policy meets compliance standards. 

Can COI tracking software integrate with tools like Procore?

Yes. illumend integrates with Procore, so compliance status sits alongside your project records.