Under the US insurance policy, an insured additive is the person or organization that enjoys the benefits of being insured under an insurance policy, other than who first purchases an insurance policy. This term generally applies in liability insurance and property insurance, but is also an element of other policies. Most often it applies where the insured original name needs to provide insurance coverage to other parties so that they enjoy the protection of new risks arising from the behavior or operation of the original insured. Insured additions often earn this status by means of support added to policies that identify additional parties by name or with a general description contained in "additional supplemental support."
For example, in vehicle insurance, a typical Automatic Personal Policy will include not only the insured person who purchases the automated policy, but will also include additional people when they drive the car with the permission of the insured party. This is a simple type of additional insurance arrangement, as it does not identify any additional insured by name, but with a general description of the "blanket" that will automatically apply to many people. Similarly, in liability insurance, all directors, officers, and employees of the named insured company will also enjoy the status of the insured, provided they act in their capacity to carry on the business of the insured company named. These people enjoy the status of the insured only when they are pursuing the business of the insured party. If they deviate to pursue their own affairs, they lose this extension of coverage. The extension of coverage to people with constant and close contact with the named insured company is achieved through the "Who Is Insured" section of the accountability policy. In other cases, the original insured name wishes to extend coverage to others not fall within this standard category. To extend further coverage, Additional Assured Support is added to the policy.
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The usual reason for entering the other party as an insured additional is due to a close relationship or legal requirement between the original named the insured and the insured addi- tion. In many cases, it is advantageous for one party to be covered as an insured addition to the other party's policy as this will reduce the history of losses from the additional insured and lower the premium. The losses will be posted against the policy of the party providing the additional insurance and their premium will rise accordingly. Typically, larger and stronger businesses will require smaller entities (who want to do business) to have a larger business called an insured addition. For example, a landlord in a commercial building often requires tenants to own a landlord called an insured addition to a tenants insurance policy. In this way, in the event of an accident or loss of a tenant's place (such as a fall or fire), the owner will enjoy the benefits of tenant insurance coverage. Similarly, general contractors often require subcontractors to give common names and owners to subcontractor policies. In this way, if the contractor or general owner is sued for accidents arising from subcontracting work, subcontractor insurance will protect contractors and public owners.
The costs associated with the risk are returned to the party most capable of controlling the risk of loss, subcontractor. Similarly, product manufacturers often want to cover product sellers as insured additions under the manufacturer's responsibility policy. This helps encourage sellers to promote the sale of the product, because the seller knows that any product liability claim against the seller will be borne by the manufacturer's liability insurance.
The additional cost of additional insurance for a property or liability insurance policy is generally low, compared to the original premium cost. The insurance company's guarantee department, good or wrong, often sees additional risks associated with the insured's additional as marginal. Insurance coverage and additional support are often the subject of debate, misunderstanding, and litigation. Disagreements are often about whether additional insurance coverage should include "independent negligence" by insured additives, or should only bear the obligations caused by the insured action.
Generally, the insured additional clause is written in broad terms, such as "whoever or organization you (named the insured) must add as an insured addition to this policy under a written contract... that person is only an insured addition in respect of the responsibilities which arise from your 'work' for the additional insurance. "(CG 70 48 04 02) Such clauses often include conditional restrictions, such as limitation of liability for claims arising during the" ongoing operations "of the insured, contracts require otherwise. And, they often contain a statement that they will be excessive to other insurance policies ("Other" Insurance issues). This may conflict with contrary provisions in other policies, leading to mutual honesty from other Insurance clauses. Thus disputes often arise based on the relative responsibility of the insured in causing the incident, and the relative obligations of each insurance company. These disputes are further complicated by the fact that some of the original contract parties may have been contractually agreed upon to compensate the other party. This compensation, in turn, may be an obligation to be covered by policies based on the coverage of "insured contract". Courts in different states decide this dispute differently, depending on the unique facts of each case and the laws of that particular country. Following the general rule that insurance policies are widely interpreted to support coverage, such disputes are often resolved in order to maximize coverage for each insured.
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Source of the article : Wikipedia
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