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What Is a Certificate of Insurance?

Tue, 06 Oct 2026 12:39:07 GMT

Learn what a COI shows, what it cannot change, and why a certificate holder is not automatically an additional insured.

A customer, landlord, or general contractor may ask for a certificate of insurance before you begin work. Commonly called a COI, it provides evidence of certain insurance coverage. It is not the insurance policy itself.

What does a certificate show?

A typical liability certificate identifies the insured business, insurer, policy numbers, policy dates, coverage types, limits, and the certificate holder. Review the business name, policy period, and requested limits carefully. The underlying policy and endorsements control coverage, not a description typed onto the certificate.

Certificate holder is not the same as additional insured

The certificate holder is the party receiving the evidence of insurance. Being listed there does not automatically make that party an insured. Additional-insured status must be supported by the policy or an applicable endorsement, and it is subject to that wording and its conditions.

A certificate cannot add missing coverage

Illinois law prohibits using a certificate to amend, extend, or alter a policy's coverage. It also prohibits a certificate from guaranteeing that a policy satisfies a contract's insurance or indemnification requirements. Listing a party on a certificate does not, by itself, create rights to cancellation or nonrenewal notice.

For example, suppose a customer requests $2 million per occurrence but your policy provides $1 million per occurrence. An agent cannot solve the difference simply by typing $2 million on a COI. The actual coverage and any acceptable additional policy must be reviewed.

What should you send to your agent?

Provide the requesting party's full legal name and address, the written insurance requirements, the job or project details, and the date needed. Requests may include additional-insured status, primary and noncontributory treatment, or a waiver of subrogation. Ask your agent to check the underlying terms instead of assuming the certificate alone supplies them.

For a policy serviced elsewhere, contact the issuing agency or insurer for evidence of that coverage. A new agency cannot assume authority to change or certify another agency's policy.

How J&L can help

We take time to review insurance requirements and explain what may need further attention. For policies we service, we can assist with appropriate certificates and endorsement requests, subject to coverage and our authority. For other policies, we can discuss a review and direct you to the appropriate servicing contact.

Related guides:

How to Get a General Contractor License in Chicago
What Insurance Does a New Business Need?

Sources

Illinois Insurance Code, Section 155.45
https://www.ilga.gov/ftp/ILCS/Ch%200215/Act%200005/021500050K155.45.html

The Hartford: certificate of insurance
https://www.thehartford.com/business-insurance/certificate-of-insurance-coi

Chicago Municipal Code, Section 4-36-090
https://codelibrary.amlegal.com/codes/chicago/latest/chicago_il/0-0-0-2611995

Employee vs. Independent Contractor

Tue, 06 Oct 2026 11:27:15 GMT

Understand why a 1099 or a signed agreement does not, by itself, settle worker classification.

A worker's classification depends on the actual working relationship and the law being applied. Giving someone a Form 1099, paying in cash, or signing an independent-contractor agreement does not automatically make the person an independent contractor.

The federal tax questions

For federal employment taxes, the IRS examines control and independence in three broad areas:

Behavioral control: Who has the right to direct how the work is performed, including instructions or training?
Financial control: Who controls business expenses, tools, investment, and the opportunity for profit or loss?
Type of relationship: Consider the agreement, benefits, expected duration, and whether the work is a key part of the business.

No single factor settles every case. A contract matters, but its label does not override how the parties actually work together.

Illinois construction has additional rules

Illinois' Employee Classification Act applies to construction. It generally presumes that an individual performing services for a contractor is an employee unless the applicable statutory requirements are met. Those requirements address control, whether the services fall outside the contractor's usual course of services, and an independently established business, with separate provisions for legitimate sole proprietors and partnerships. Simply using an LLC or corporation does not automatically resolve classification.

Do not use one test for every purpose

Federal tax, wage-and-hour, unemployment, and workers' compensation rules can apply different standards. An IRS classification analysis is not a universal determination under every law. Likewise, an insurance audit may require worker-payment records, job descriptions, and subcontractor insurance documents; a 1099 alone does not answer every insurance question.

A practical starting point

Before engaging a worker, document the services, who directs the work, who supplies equipment, payment arrangements, and the business relationship. Have uncertain situations reviewed rather than assuming the form of payment determines the answer. The IRS also has a Form SS-8 process for requesting a federal employment-tax status determination.

How J&L can help

Dennisse M. Castro is an Enrolled Agent and Licensed Insurance Producer. J&L can help review tax-reporting considerations, organize records, and discuss related insurance needs. Questions requiring employment-law advice or a legal determination should be reviewed by a qualified attorney.

Related guides:

What Documents Should a New Business Keep?
What Insurance Does a New Business Need?

This guide is educational and does not determine any particular worker's legal status. Rules and enforcement guidance can change.

Sources

IRS: employee or independent contractor
https://www.irs.gov/taxtopics/tc762

IRS: type of relationship
https://www.irs.gov/businesses/small-businesses-self-employed/type-of-relationship

Illinois Department of Labor: classification FAQ
https://labor.illinois.gov/faqs/ecafaq.html

U.S. Department of Labor: classification FAQ
https://beta.dol.gov/policy-regulations/pay-benefits/wages-hours/flsa/misclassification-employees-independent-contractors/faqs

The Hartford: workers' compensation audits
https://www.thehartford.com/workers-compensation/audit

When Should a Business Hire a Bookkeeper?

Tue, 06 Oct 2026 11:24:50 GMT

Recognize the signs that it is time for help with reconciliations, transaction records, and financial reports.

You do not need a large company to benefit from bookkeeping help. A useful question is whether your records are accurate, current, and helping you make decisions. The right time to get support depends on your transactions, complexity, and available time - not just revenue.

Signs it may be time for support

Your bank accounts are not reconciled. You cannot confidently explain why the balance in your books differs from the bank statement.

You are unsure what the business earns. Money is coming in, but you do not have a reliable picture of revenue, expenses, and profit.
Personal and business activity are mixed. You regularly need to untangle household purchases, owner payments, transfers, and business spending.
Your records are always behind. You postpone entering transactions and spend tax season trying to rebuild the year.
Invoices and bills are difficult to track. You are unsure who still owes you or which expenses remain unpaid.
You need usable financial reports. A lender, tax preparer, or business decision requires information that you cannot easily produce.
The work is taking time you need elsewhere. You would rather manage jobs, serve customers, or develop the business than catch up on administrative tasks.

What bookkeeping should help you accomplish

An appropriate engagement can include organizing transactions, reconciling accounts, maintaining supporting records, and preparing agreed-upon financial reports. A downloaded bank feed is a starting point, not a substitute for reviewing how transactions should be recorded.

Good records also help identify income sources, support deductible expenses, and prepare tax returns. The goal is not just a cleaner file at year-end; it is information you can use throughout the year.

What to prepare for your first conversation

Gather recent bank and credit-card statements, access details for your accounting software, outstanding invoices or bills, and any prior financial reports. Tell us how far behind the records are and what you want the reports to help you understand. Share access and documents only through the method agreed with your provider.

How J&L can help

We take time to understand your business and discuss a bookkeeping scope that fits your needs. If you also need tax preparation or business insurance, we can discuss those separately. Services outside our scope may be referred to an independent professional.

Related guides:

What Documents Should a New Business Keep?
Employee vs. Independent Contractor.

Sources

IRS: recordkeeping
https://www.irs.gov/businesses/small-businesses-self-employed/recordkeeping

IRS: what records to keep
https://www.irs.gov/businesses/small-businesses-self-employed/what-kind-of-records-should-i-keep

What Documents Should a New Business Keep?

Tue, 06 Oct 2026 11:23:06 GMT

Build an organized system for financial, tax, insurance, and business records from the beginning.

Organized records help you understand your business and support the information reported on tax returns. Start a system before receipts, contracts, and bank activity become difficult to reconstruct.

Business identity and operating documents

Keep formation documents, EIN confirmation, ownership agreements, assumed-name records, licenses, permits, leases, and important contracts together. Track renewal dates. Some documents may need to be retained long after a project or tax year ends.

Income, spending, and assets

Save customer invoices, sales records, receipts, deposit details, bank and credit-card statements, and evidence supporting business expenses. Keep records showing when equipment was purchased, what it cost, improvements, business use, and eventual sale or disposal. A statement or payment-app total alone may not explain a transaction's business purpose.

Label deposits clearly. Customer payments, transfers between accounts, owner contributions, and borrowed money should not all be treated as interchangeable entries. Clear notes help your bookkeeper determine the appropriate treatment.

Insurance, employees, and subcontractors

Maintain policies, endorsements, certificates of insurance, claim information, and audit records. Keep worker agreements and the applicable tax and payment records. For subcontractors, retain agreements, payment details, and insurance evidence covering the relevant work period. Ask your advisor which records apply to the actual working relationship.

How long should records be kept?

There is no single retention period for everything. The IRS generally uses a three-year period for many income-tax records, but important exceptions require longer retention. Employment-tax records generally need to be kept at least four years after the tax is due or paid, whichever is later. Asset records generally must remain available through the limitation period for the year of disposal. Contracts, insurers, employment rules, or legal disputes may require longer retention.

Make the system usable and secure

A practical approach is to organize records by year and category, reconcile financial accounts regularly, and use secure storage with restricted access and backups. Do not send sensitive employee or taxpayer information through a public website contact form.

How J&L can help

We can help organize bookkeeping, identify missing information, and establish a repeatable recordkeeping routine. Bring the records you have, and we will discuss a realistic starting point.

Related guides:

When Should a Business Hire a Bookkeeper?
How to Start a Business in Illinois?

Sources

IRS: what records to keep
https://www.irs.gov/businesses/small-businesses-self-employed/what-kind-of-records-should-i-keep

IRS: how long to keep records
https://www.irs.gov/businesses/small-businesses-self-employed/how-long-should-i-keep-records

The Hartford: workers' compensation audits
https://www.thehartford.com/workers-compensation/audit

FTC: Start with Security
https://www.ftc.gov/business-guidance/resources/start-security-guide-business

How to Get a General Contractor License in Chicago

Tue, 06 Oct 2026 11:21:15 GMT

Learn the basic application steps and why your license class, insurance limits, and policy wording matter.

Planning to perform contracting work in Chicago? First confirm the license required for your actual scope. A general contractor license does not replace separate trade licenses or project permits that may apply.

Choose the correct license class

Chicago's general contractor classes are tied to project value and permitted activity. The following reflects the City's published 2026 requirements; confirm current requirements before applying.

Related guides:

What Is a Certificate of Insurance?
What Insurance Does a New Business Need?

Sources

City of Chicago: general contractor licenses
https://www.chicago.gov/city/en/depts/bldgs/supp_info/TLdetails/GC.html

Chicago Municipal Code, Section 4-36-090
https://codelibrary.amlegal.com/codes/chicago/latest/chicago_il/0-0-0-2611995

Chicago: general contractor changes for 2026
https://www.chicago.gov/content/dam/city/depts/bldgs/general/LicensingCTS/GeneralContractor2026.pdf

The City increased Class C and D insurance requirements to $2 million in 2026. For previously issued C and D licenses, the City states the increased requirement applies when the insurance policy on file expires. Demolition permissions also depend on class.

Prepare the application and supporting documents

The City's checklist includes the application, a financial-solvency statement, applicable business-authorization documents, identification, and insurance evidence. Requirements differ by business structure. Use the current City checklist for your application and confirm the submission method and fees before sending payment.

Verify the insurance wording, not just the limit

Chicago's code requires an Illinois-authorized insurer with an A.M. Best rating of B+ or higher, specified liability coverage, and the City as an additional insured on a primary, noncontributory basis. It also specifies advance cancellation or lapse notice. Limits above $1 million may be satisfied using an appropriate combination of primary and excess or umbrella policies. The policy and endorsements must support the required terms.

Apply, maintain coverage, and track renewals

Submit through the City's current licensing process and address any missing items. Keep insurance current and track license and policy renewals. Do not assume an application or a certificate of insurance by itself authorizes work.

How J&L can help

J&L can explain the insurance requirements, explore appropriate coverage, and assist with organizing certain application materials. For policies we service, we can request or issue appropriate insurance evidence within our authority. Licensing decisions remain with the City; we cannot guarantee approval.

What Insurance Does a New Business Need?

Tue, 06 Oct 2026 10:53:01 GMT

Understand common coverages and how your operations, employees, vehicles, and contracts affect your insurance needs.

There is no single policy that fits every new business. A cleaning company, a contractor with work vans, and a retail store have different exposures. Start by describing what the business actually does, not just its name or industry.

General liability and business property

General liability can help respond to covered claims involving injury to others, damage to others' property, and certain personal or advertising injuries. Commercial property insurance addresses covered damage to business property such as a building, equipment, furniture, or inventory. These are different needs; liability coverage is not a substitute for insuring your own property.

A Business Owners Policy, or BOP

A BOP typically combines general liability, business property, and business income coverage for eligible businesses. It does not mean everything is included. A standard BOP generally does not include workers' compensation, commercial auto, or professional liability. Eligibility and coverage vary by insurer.

Vehicles and employees

Discuss any vehicle used for business, including personal vehicles used by owners or employees. Commercial auto or other appropriate business-auto coverage may be needed depending on ownership and use. Do not assume that all work-related driving is covered by a personal auto policy.

Illinois generally requires workers' compensation insurance when a business has even one employee, including a part-time employee, with limited exceptions. Ownership exemptions and special situations need separate review. Calling a worker a subcontractor does not automatically settle the requirement.

Additional needs and contract requirements

Professional services may call for professional liability coverage. A contract may also require higher liability limits or particular policy endorsements. Ask your agent to review the actual requirements; the words "fully insured" do not explain which risks a policy covers.

What to gather before asking for a quote

Prepare a description of your work, location, expected revenue, employees, subcontractors, vehicles, equipment, and any written insurance requirements. For example, a new cleaning business should explain whether it cleans homes or offices, hires help, and uses vehicles to travel between jobs.

How J&L can help

We review your operations and available documents, explain potential coverage needs, and explore options through our available markets. We can also help you understand which requirements need attention before a contract starts.

Related guides:

What Is a Certificate of Insurance?
Employee vs. Independent Contractor

Coverage depends on the policy, endorsements, exclusions, limits, and underwriting. This guide does not bind coverage or guarantee that a claim will be covered.

Sources

NAIC: small-business insurance
https://content.naic.org/consumer/small-business.htm

SBA: launching a business
https://www.sba.gov/counseling/launch-your-business/

Illinois Workers' Compensation Commission: insurance
https://iwcc.illinois.gov/about/insurance.html

How to Start a Business in Illinois

Mon, 05 Oct 2026 22:57:58 GMT

A practical starting point for business registration, tax setup, insurance, and organized records.

Starting a business involves more than choosing a name. Registration, tax responsibilities, licensing, insurance, and recordkeeping all need attention. The right steps depend on what you do, where you operate, and how the business is organized.

Start with the business structure and name

Decide who will own the business and discuss the tax and legal implications before filing. An Illinois LLC is formed by filing Articles of Organization with the Secretary of State. Its name must meet state requirements, and it must maintain an Illinois registered agent and registered office. Other structures have different requirements. Check assumed-name requirements when using a name different from your legal business name.

Obtain the appropriate tax registrations

An employer identification number, or EIN, is a federal tax identification number. The IRS issues EINs at no charge. When forming an LLC or corporation, complete the state formation first, then apply for the EIN. Not every sole proprietor needs one for federal taxes, although a bank or state registration may make it useful.

Separately, determine which Illinois tax registrations apply. These may include sales tax, withholding, or business income tax. MyTax Illinois provides the state's business registration process using Form REG-1. An EIN does not replace state registration.

Check licenses, permits, and location rules

A registered LLC is not the same as a business or professional license. Check the requirements for your work and operating address before signing a lease or accepting jobs. Chicago contractors, for example, may need a city general contractor license or a separate trade license.

Set up finances and protection before you get busy

Open appropriate business banking, keep business activity separate from personal spending, and establish a routine for recording income and expenses. Review insurance before beginning operations, hiring, using vehicles for work, or signing contracts. Keep a calendar for tax filings, license renewals, and applicable entity reports.

How J&L can help

J&L provides business start-up guidance, bookkeeping, tax preparation, and insurance assistance. We take time to understand your plans and help organize the next steps. When a question requires legal advice or a service outside our scope, we may connect you with an independent professional. Payroll services are available through referral partners, not provided directly by J&L.

Related guides:

What Insurance Does a New Business Need?
What Documents Should a New Business Keep?

This is a general starting checklist, not a complete list of requirements for every business. J&L does not provide legal advice or guarantee registration or license approval.

Sources

Illinois Secretary of State: forming an LLC
https://www.ilsos.gov/departments/business-services/organization/llc-instructions.html

IRS: employer identification numbers
https://www.irs.gov/businesses/employer-identification-number

Illinois Department of Revenue: business registration
https://tax.illinois.gov/businesses/registration.html

SBA: launching a business
https://www.sba.gov/counseling/launch-your-business/