What is the purpose of a COI in freight arrangements?

• A. Demonstrate required liability and cargo coverage
• B. Show driver compliance
• C. Provide credit rating
• D. Confirm warehouse location

Answer: (A)

A COI, or Certificate of Insurance, serves as proof that the carrier has insurance to cover risks in transit. In freight moves, this certificate shows the types of coverage (like liability and cargo), the coverage limits, who is insured, and the policy’s active dates. By presenting a COI, the shipper or broker can confirm there is financial protection if something goes wrong—such as damage, loss, or a bodily injury during transport—before approving the shipment. It’s a key risk-management document that helps ensure both sides are protected and responsible for their risks. It isn’t about driver compliance, credit ratings, or warehouse locations.