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Most insurance policies are written such that the party is added as an Additional Insured only if required by a written contract or if the party is specifically named in an endorsement. This is not merely done by issuing a COI. There is all sorts of disclaimer language on the standard COI form saying that it’s not legally enforceable and does not change any terms of the actual policy. So the reality is, all of your customers without a contract who are demanding a COI with AI language are almost certainly not legally entitled to AI coverage just because of the COI being issued.
Because of that, your Risk Manager is technically correct in that issuing the COI w/o a contract that requires AI is non-binding and a waste of everyone’s time. On the other hand, our team does this all the time because very few customers understand or accept this, so it’s not worth fighting over.
Rising Star
+1 to this.
I love giving people something they want that’s legally irrelevant and costs me nothing. I’ll even make a big show of it, so they feel like a big big man. Deals done much quicker than when I have to educate opposing counsel/procurement.
If they want to get into particulars and mandate bespoke coverage, “no problem, we have a process to do that, but we’re not going to be able to offer those same discounts anymore and we’re going to need to increase the price to offset the insurance costs.” 9/10 that shuts it down.
Conversation Starter
As an in-house counsel, I feel like my Risk Manager is being too difficult and causing additional bureaucracy. But at the same time, maybe I don’t understand the insurance and endorsements (additional insured, primary and non-contributory, waiver of subrogation) How is it at your company? What is the implications and consequences of issuing COIs to customers with all these endorsements?