Additional Insured

An additional insured is a person or entity that is added to an insurance policy by endorsement, with limited coverage rights that are narrower than the rights of the named insured. The additional insured is covered for liability arising from the named insured's operations, premises, or work, but typically not for their own independent acts.

The most common use of additional insured status is in commercial contracts: a general contractor is named as an additional insured on a subcontractor's general liability policy so that if a third party sues the general contractor for something the subcontractor did, the subcontractor's policy responds. Landlords are commonly named as additional insureds on tenant policies. Mortgage lenders, lessors, and franchisors are routinely added.

How additional insured differs from named insured: the named insured holds the broadest rights — making changes to the policy, filing claims, receiving the refund on cancellation, paying premiums. An additional insured does not have those rights; they only have coverage in their specific defined capacity. For example, an additional insured cannot cancel the policy or change coverage terms.

The additional insured endorsement is typically a small premium increase, often 25 to 100 dollars per additional insured per policy term. Some carriers issue free additional insured certificates for certain relationships. The endorsement form (most common form numbers are CG 20 10 and CG 20 37 for commercial general liability) defines exactly when and how the additional insured is covered.

Many commercial contracts require additional insured status as a condition of doing business. If your business contract requires it and you do not have it, your policy can decline the claim and you may be in breach of contract. Coverage Reviews catch these gaps before they become problems.