An insured has an ISO CGL policy with additional insured forms attached, specifically listing the general contractor as an additional insured. Does a named insured need to be named in a claim to trigger coverage on the policy for the additional insured?
An insured has an ISO CGL policy with CG 20 10 and CG 20 37 additional insured forms attached, specifically listing the general contractor as an additional insured.
Q: Does a named insured need to be named in a claim or suit to trigger coverage on the policy for the additional insured?
Response 1: No. The additional insured is an insured. Section IV.7. of the policy, Separation of Insureds, reads as follows: “this insurance applies (b) separately to each insured against whom claim is made or ‘suit’ is brought."
Response 2: No, the named insured does not need to be named in a suit for additional insured coverage to apply. The requirement is only that bodily injury or property damage must be caused, at least in part, by the acts or omissions of the named insured, or the acts or omissions of those acting on behalf of the named insured. But that does not mean that the named insured must be a named defendant in the complaint. The additional insured’s actual extent of coverage depends heavily on the facts and circumstances of the case.
Response 3: Not necessarily, but the named insured must have some liability to trigger coverage for the additional insured on the current forms. If the insurer doesn't agree that the named insured is either directly or vicariously culpable , that might require a formal charge. In most cases, a smart attorney will allege liability on the part of anyone connected to the work.
Response 4: No. All insureds are covered separately. But be careful of the additional insured edition date. Since July 2004, many additional insured endorsements require that the named insured, or the people they are responsible for, be at least partly negligent for a loss.
Response 5: Is the complaint for injury or damage arising out of the named insured's operations? The additional insured has coverage for claims arising out of the activities of the named insured.
Response 6: It depends on the edition of the form. If it's later than 2001, the additional insured only has protection for liability arising “in whole or in part” from the named insured's work. There’s no protection for sole liability. That's why contracts often ask for a CG 20 10 11 85 or its equivalent.
Response 7: Typically, no. However, the additional insured's coverage will only be to the extent described in the additional insured form.
Response 8: The additional insured has no rights under the contract until the named insured advises the carrier of record that the policy may incur a claim. The named insured must supply all relevant information to enable the carrier to make a determination of coverage and a reservation of rights during the investigation.
I recommend that each party review the terms and conditions of their respective policies, along with any contract information relevant to the claim.
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