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An additional insured is a person or organization that is not the policyholder but is given insured status under someone else’s liability policy. An additional insured endorsement is the form attached to that policy that grants the status and sets its scope. In construction, a general contractor requires each subcontractor to add it as an additional insured. If the contractor is then sued over the subcontractor’s work, the subcontractor’s insurer defends the contractor too, under the subcontractor’s policy.

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Additional insured, named insured, certificate holder

These three are often confused, and only two of them are insured. Being the certificate holder on an ACORD 25 does not make you an additional insured.

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The forms you will see

Most general liability policies in the United States use standard ISO forms. The form number is printed on the endorsement, followed by an edition date such as 04 13 (April 2013). Insurers also issue their own versions, usually as blanket endorsements. The wording of those varies, so read what you are given. Workers’ compensation has no additional insured endorsement. What a contract usually requires there is a waiver of subrogation, on form WC 00 03 13.

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Ongoing and completed operations

This is the gap that catches contractors most often. Current editions of CG 20 10 cover only ongoing operations. Once the subcontractor’s work on the project is complete, that coverage stops. Claims for property damage or injury from finished work, which is where construction defect claims come from, can arrive years later. Completed operations coverage for the additional insured comes from a second endorsement, CG 20 37. A subcontract that requires additional insured status for both ongoing and completed operations needs both forms, or one insurer form that grants both. Older contracts sometimes ask for “CG 20 10 11 85”. That 1985 edition covered both in one form. It is rarely available now, which is why the pair of CG 20 10 and CG 20 37 is the usual answer.

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Scheduled and blanket endorsements

A scheduled endorsement names the additional insured. Yours should show your company’s name. A blanket additional insured endorsement, also called automatic, names nobody. It applies to any party the named insured has agreed in a written contract to add. Three things are worth checking on one:
  • It depends on the contract. No written agreement, no additional insured status.
  • Some forms reach only a party in direct contract with the named insured. An owner or upstream contractor may not be covered unless the form extends to them, as CG 20 38 does.
  • It may cover ongoing operations only. Look for completed operations wording.

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Why the edition date matters

The 04 13 editions of the ISO forms added three limits on what the additional insured receives:
  • Coverage applies only to the extent permitted by law.
  • Coverage is no broader than the contract requires.
  • The most the insurer pays is the lower of the amount the contract requires and the policy limits.
So what your subcontract says about insurance controls how much of the subcontractor’s policy you can rely on.

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A checked box on a certificate is not the endorsement

An ACORD 25 has an ADDL INSD column. A Y in it is a statement by the agent who issued the certificate. The form says on its own face that if the certificate holder is to be an additional insured, the policy must be endorsed or contain additional insured provisions, and that a statement on the certificate does not give the holder rights in place of the endorsement. The proof is the endorsement itself.

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What to ask the subcontractor’s broker for

  1. A copy of the additional insured endorsement attached to the general liability policy, showing the form number and edition date.
  2. Both ongoing and completed operations, if your contract requires both.
  3. Your name in the schedule, or blanket wording that reaches you under your contract.
  4. The other endorsements your contract requires, usually primary and non-contributory (CG 20 01) and waiver of subrogation (CG 24 04).
Keep the endorsement with the certificate. It is what a claim will turn on.

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How WatchMyCover records this

For each required endorsement, WatchMyCover records one of three evidence levels: not on the certificate, stated on the certificate, or endorsement form on file. On a mandatory coverage, a subcontractor whose additional insured status is only stated stays at Needs review until the form is on file, and the finding names the form to ask for.