What Does An Additional Insured Mean For a Contractor?

Contractor Additional Insured (AI’s): What are they, how do they work, and why do companies require them?

On the surface, an AI is exactly what it sounds like; the business or person is also insured under your policy for the work or project you’re doing. This makes it so your landlord, general contractor, or other additional insured can file a claim directly against your policy and get protection for damage you cause, rather than filing against their own policy. There are several AI forms, and they operate in different ways depending on what the AI’s interest is in your work. Here are a couple common scenarios involving the more “standard” forms before we dive into more complex areas:

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Landlord listed as an AI:

Very common when you’re leasing an office, shop, or yard. If you get sued for an injury at your office (someone trips and falls, etc.), this extends coverage to your landlord if they get wrapped into the lawsuit as well.


Similar to the landlord AI. If the lender gets wrapped up in a lawsuit for property damage or bodily injury, your policy will help defend them.

Vendors and companies leasing you equipment:

If you rent construction equipment, and cause damage or injury with it, an additional insured in favor of the rental company protects them if they’re dragged into a claim or lawsuit.

A business you’re doing work for:

If you injure someone at a business’s location, or cause damage to their building or property, an AI will let them file a claim directly to your insurance, rather than needing to use theirs first.

Another contractor:

The contractor can file a claim against your policy rather than theirs if you damage something. The general contractor is ultimately responsible for damage to the project because they hold the contract with the client. If a sub causes a fire or their machinery damages a structure, an AI in favor of the general contractor allows the GC to file a claim directly with the sub’s insurance policy.

Won’t my insurance cover damage I cause though? Why do they need me to list them as additional insured on my policy?

Simply put, an AI provides a straight path for a landlord or contractor to file a claim. If you’ve caused damage, the AI can immediately get the claim rolling, and they can go through your policy rather than their own. There usually won’t be the question of “does this person have insurance?”, and an AI endorsement formally shifts more of the responsibility onto your policy.

The certificate holder clause says that the insurance company will notify the additional insureds in a timely manner if the policy is being canceled, so that gives an additional layer of protection for the AI.

In the next article, we’ll dive into the 4 most common additional insured forms, how to interpret them, and what you need to look out for. We’ll also go over what “primary wording” and “waiver of subrogation” forms are.

Will a Car Crash With an Animal Raise My Insurance Rates?


If a deer jumps out from the side of the road and you crash into it, does that count as an at fault accident and will it raise your rates? The short answer is no, but there’s an asterisk. Your insurance company and DMV knows that often there isn’t much you can do about an animal running in front of your car, and it’s not your fault that they did! It’s considered a “comprehensive” claim, which are not at fault in almost all cases. If you have comprehensive coverage on your car then you’ll have to pay your deductible, and your car will get fixed right up. If you don’t have comp., then unfortunately you’ll have to pay for the repairs out of pocket, because that critter you hit probably doesn’t have enough cash to get it fixed for you.

Photo by Ivana Cajina on Unsplash

So what about the asterisk? If you swerve or try to maneuver away from the animal and run into something else, then it turns into an at fault accident. Once you turn the wheel and try to correct, then you’ve taken an active role in the accident. So as heartless as it sounds, if little Bambi jumps in front of you, you’re better off not trying to avoid it. Swerving away can make a bad situation even worse if you lose control of your car or get into a head on collision.

Which Tickets Increase My Insurance Rates?

Not all tickets go onto your DMV report, and not all tickets on your DMV report will impact your rates. So which will? Anything considered a moving violation is going to get you points on your license, and increase your insurance rate. That includes speeding tickets, failure to yield, red light and stop sign violations, DUI’s, reckless driving, and more. The minor citations stay on your record for 3 years, and majors like a DUI will stay on for 5 years. DUI’s also remove your California good driver discount (20%) for 10 years!

So which tickets won’t bump up my rates? Fix it tickets, seatbelt tickets, parking tickets, and surprisingly cell phone tickets don’t for most companies. Cell phone tickets are still recorded on your license and show up on your report, but they don’t actually count as a chargeable moving violation fortunately.

What can you do if you get a ticket? If you haven’t done so in the past 18 months, the DMV lets you go to traffic school to remove 1 minor violation. You can take a course online and submit it to the DMV, but keep in mind that you have limited time to complete it. Check the back of your ticket, and it should say that you have a 90 day window to take traffic school. It’s worth it every time, because even 1 ticket could cost you a thousand dollars or more over 3 years in increased insurance costs!