An additional insured endorsement changes an insurance policy to expand coverage to a person or organization that isn’t named in the original policy. You may need to add other parties to your business insurance policy if you lease space or work as a subcontractor.
To break the term down further, an “additional insured” is a party who's added to an insurance policy so that they can be protected alongside the policyholder.
An “endorsement” is a modification to an insurance policy. Endorsements are also called riders.
The most common reason to add an additional insured to your policy is because someone — a landlord or a general contractor, for instance — asks you to.
If you lease space, your landlord may require you to purchase business property insurance and add them as an additional insured.
If you’re a subcontractor on a construction site, your general contractor may ask to be added to your general liability insurance policy as an additional insured.
Adding an additional insured could take as little as a few minutes, depending on your insurance provider.
Some business insurance companies, like Next , allow you to add an additional insured yourself online. In other cases, you may have to call your insurance company.
When you add an additional insured to your policy, they'll also be added to your certificate of insurance .
In general, adding endorsements can increase the cost of business insurance . But the cost of adding an additional insured depends on your insurance provider.
Thimble , for example, says customers can add additional insureds for free. Other insurance companies may charge a fee.
If you find yourself adding additional insureds to your policies regularly, you might consider adding a blanket additional insured endorsement instead. This endorsement automatically extends your insurance coverage to others when contracts require it.
Read the language carefully, though — this endorsement might be limited to certain types of contracts or business entities.
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Frequently asked questions
What does adding someone as an additional insured mean?
Adding a person or organization as an additional insured extends your insurance policy so that it covers them in addition to you or your business.
What is the difference between insured and additional insured?
The insured is the person or organization that holds the insurance policy and pays the premiums. An additional insured is someone else who's been added to the insurance policy so that they and their work can be covered alongside the policyholder against liability claims.
Who can be added as an additional insured?
Most commonly, policyholders are asked to add general contractors or landlords to their insurance policies as additional insureds.
What are the benefits of an additional insured?
When you add someone to your insurance policy as an additional insured, they receive coverage for some claims from your insurance policy, not their own.