An additional insured is a person or company, such as a landlord or client, added to your liability policy so it can protect them from claims tied to your work.
How it works
Your policy names your business as the named insuredNamed insuredThe named insured is the person or business listed on the declarations page as the policyholder, with the main rights and duties under the policy.Read the definition. An additional insured is someone else who gets some protection under your policy, added by an endorsementEndorsementAn endorsement is a written change to an insurance policy that adds, removes or modifies coverage, such as adding an additional insured or a new location.Read the definition. If a customer sues your landlord over an injury connected to your business, the landlord can ask your insurer to defend them, subject to the endorsement’s terms and your limits.
Additional insured status is usually narrower than yours. Many endorsements cover the additional insured only for claims arising out of your work or operations, not for their own unrelated activities. Some cover only work in progress, while others also extend to completed workProducts-completed operationsProducts-completed operations is the part of general liability that covers injuries or damage caused by your finished work, or products you sold, after the job is done.Read the definition. The additional insured shares your limits rather than getting a separate set.
Endorsements come in two broad styles. A scheduled endorsement names a specific person or company. A blanket endorsement automatically includes anyone you’ve agreed in a written contract to add, which saves you from changing the policy for each new client.
Additional insured vs. certificate holder
A certificate holderCertificate holderA certificate holder is the person or company that receives a certificate of insurance as proof of your coverage, without gaining any coverage under your policy.Read the definition only receives proof that you have insurance. An additional insured has actual rights under your policy. Being listed on a certificate of insuranceCertificate of insuranceA certificate of insurance (COI) is a one-page summary that proves your business has insurance, listing your policies, limits, insurers and policy dates.Read the definition doesn’t make someone an additional insured. The endorsement on the policy does.
Where you’ll see it
Commercial leases, client contracts and subcontracts often require it, sometimes along with primary and noncontributoryPrimary and noncontributoryPrimary and noncontributory is policy wording that makes your insurance pay first for a covered claim, without asking the additional insured’s own insurance to share the cost.Read the definition wording and a waiver of subrogationWaiver of subrogationA waiver of subrogation is an agreement, usually added to your policy by endorsement, that stops your insurer from recovering claim payments from a specific client, landlord or contractor.Read the definition. Read the contract’s exact wording before you sign, then ask your insurer whether your general liability policy can add what it asks for.