This is a complex question. In fact, the Commercial General Liability policy devotes an entire page of the legal contract to define who qualifies as an insured.
The primary insureds are the named insureds set out in the policy declarations. In addition, who qualifies as an insured will depend on your organizational structure. Here’s how the CGL policy defines an insured:
- Individual/Sole Proprietor: you and your spouse are insureds, but only with respect to the conduct of a business of which you’re the sole owner
- Partnership or Joint Venture: you are an insured; your members, partners and their spouses are also insureds, but only with respect to the conduct of your business
- LLC: you’re an insured; your members are insureds but only with respect to the conduct of your business; your managers are also insureds but only with respect to their duties as your managers
- Any organization other than a partnership, joint venture or LLC: you are an insured; your executive officers and directors are insureds but only with respect to their duties as your officers or directors; your stockholders are also insureds but only with respect to their liability as stockholders
- A Trust: you are an insured; your trustees are also insureds but only with respect to their duties as trustees
In addition, the policy also specifies other parties considered to be an insured:
- Your volunteer workers, but only while performing duties related to the conduct of your business. This is a tricky section of the policy so if you have volunteer workers, it’s best to discuss this situation with your Insurance Advisor.
- A person or organization acting as your real estate manager
- Any person or organization having proper temporary custody of your property if you die
Note: It’s best NOT to assume that a certain individual or organization is considered an insured on your policy. If coverage is needed, it’s recommended that you discuss with your Insurance Advisor as soon as possible since insurance companies aren’t likely to make an exception on the definition of an insured once a claim has occurred.
If you’d like to learn more, contact one of our Licensed Advisors. We’re here to help.