Who should be named as additional insured?
To be included as an additional insured under a liability policy, a person or entity must have a business relationship with the policyholder (named insured). Here are some common business relationships that create a need for additional insured coverage: Landlord and tenant. General contractor and subcontractor.
Why is it important to be named as an additional insured?
The additional insured benefits from coverage and rights under the named insured’s policy in the event of a claim. The purpose of additional insured endorsements is to keep the burden of risk closest to those parties most likely to create losses, which typically is third parties contracted to perform the work.
Can you be named as an additional insured on a professional liability policy?
Depending on your business, you may be able to ask another policy holder to be an additional insured on their professional liability insurance policy, also known as errors and omissions insurance or E&O insurance. However, you can’t be named an additional insured on your own policy.
What is the difference between a named insured and an additional named insured?
A named insured is entitled to 100\% of the benefits and coverage provided by the policy. An additional insured is someone who is not the owner of the policy but who, under certain circumstances, may be entitled to some of the benefits and a certain amount of coverage under the policy.
What is the benefit of being an additional insured?
Benefits of Additional Insured An additional insured amendment is helpful since it protects the individuals or parties that have been extended coverage under the named insured’s policy. If a claim is filed or a lawsuit materializes, the additional insured would be covered.
What is an additional named insured on an insurance policy?
Additional Named Insured — (1) A person or organization, other than the first named insured, identified as an insured in the policy declarations or an addendum to the policy declarations. (2) A person or organization added to a policy after the policy is written with the status of named insured.
What does additional insured on general liability mean?
An additional insured status in a liability policy extends the coverage beyond the named insured to include other individuals or groups that were not named in the original policy. Instead, a general description of the type of groups or individuals that are to be extended coverage is added to the named insured’s policy.
Can an additional insured sue a named insured?
When two covered parties secure cross-liability coverage, one insured party can sue another insured party even when both parties are under the same policy. Standard liability insurance typically includes a cross-liability clause known as a “Separation of Insureds” agreement.
When should you be added as an additional insured?
Construction contracts commonly require adding additional insureds to general liability coverage due to all the risks involved. Developers, building managers and other clients want to ensure they’re protected in case of common construction claims such as bodily injury or property damage.
Why is there no additional insured on Professional Liability?
Additionally, your firms client cannot be an additional insured on Professional Liability because they are not performing ‘professional services’ and does not have the risk that a design professional does. It is more common to have an additional insured on a Commercial General Liability policy for Design Professionals.
What rights does an additional named insured have?
An additional named insured has more rights than the additional insured, and therefore more extensive coverage. As a result, additional named insured will have the same rights as the named insured and will receive notice of policy cancellations or changes, however will not be responsible for paying the premium.
What are the two main types of additional insured endorsements?
The first two ISO endorsements require specific information regarding the additional insured and the project. The third and fourth ISO endorsements are “blanket” additional insured endorsements and do not require specific information concerning the additional insured or project information be shown on the endorsements.