What is an “Additional Insured” in Business Insurance?

What is an “Additional Insured” in Business Insurance?

Dec 27, 2018


What is an “Additional Insured” in Business Insurance?

What is an €œAdditional Insured€ in Business Insurance?What you should know about an Additional Insured.  

You may think you know the ins and outs of your business insurance, but do you know what an additional insured is and when this applies to your business? Here's what you should know about an additional insured. When subcontractors perform work for general contractors, they typically need to show the general contractor that they carry their own insurance. This principle is also true with resellers of someone else's product and in other close business relationships. In addition to expecting a Certificate of Insurance, the contractor often asked to be named as an Additional Insured. This helps the contractor to be covered in case of an accident, loss, and a claim. An Additional Insured is a person or organization that gets to enjoy the benefits of being insured under someone else's insurance policy, in addition to whoever purchased the policy (called the Named Insured). The specific coverage will depend on the individual policy, but the Additional Insured status offers crucial protection, such as:
  • Defense coverage: Coverage for when a third party sues your Additional Insured. Your policy can address the claim so that legal defense fees, court fees, and settlement costs are not left to the Additional Insured person or entity.
  • Third-party lawsuit coverage. This includes claims of bodily injuries, property damage, and advertising injuries (for example, libel, slander, and copyright infringement).
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