The named insured has his/her name in the declarations. He/she possesses all the rights of that policy and also accepts all the obligations of that policy. An additional insured (i.e., an outside party) is someone who is given less than the full rights of insured status as an additional insured through an endorsement. He/She will have coverage only for liability claims caused because of the named insured's work or relationship to him/her. This person does not have their own limit of insurance. They do not get to make decisions about this policy. Wherever the CGL states "You," it refers solely to the named insured.
The most common response from brokers to a customer asking why being placed "on" another person's insurance is not the same as having a policy is usually to explain the hierarchical nature of an insured status that CG 00 01 builds. As the lowest level of the hierarchy, the concept of being an additional insured is a meaningful addition only at the base level.
Insured Status Tiers
The CGL policy recognizes insureds at three levels: named insureds listed in the declarations, automatic insureds who qualify through their relationship to a named insured under Section II, and additional insureds granted limited status by endorsement. Each tier down carries fewer rights and fewer duties.
Who is an insured under CG 00 01?
An insured under CG 00 01 is any party that lands on one of three tiers: a named insured listed in the declarations, an automatic insured under Section II, or an additional insured added by endorsement. The top tier is the named insured, each person/organization listed on the policy's Declarations who retains all rights to the policy as well as all responsibilities.
The middle tier is automatic insureds, who qualify through their relationship to the named insured. The entity type drives who makes the list:
- Sole proprietorship: the named insured's spouse, but only for the conduct of the business.
- Partnership or joint venture: the partners and their spouses.
- LLC: the members and the managers.
- Corporation: the executive officers, directors, and stockholders.
- Trust: the trustees.
Employees and volunteer workers qualify while acting within their duties. The bottom tier is additional insureds, outside parties written onto the policy by endorsement because a contract demands it. Nobody drifts between tiers.
What special duties does the first named insured carry?
When a policy lists several named insureds, the one listed first is the carrier's single point of contact. The first named insured pays the premium, receives any return premium and audit bill, alone requests policy changes for every insured, and is the only party entitled to notice of cancellation or nonrenewal. Give that slot to the entity that actually opens carrier mail, because a cancellation notice sent to a dormant holding company is still valid notice.
What does additional insured status cover, and where does it stop?
An additional insured gets real coverage, which separates the status from a certificate holder's purely informational position. On the CGL it usually arrives through CG 20 10 for ongoing operations, CG 20 37 for completed operations, or a blanket form triggered by written contract. Once endorsed, it can tender a covered suit to the named insured's carrier and receive a defense paid outside the limits, and paired with primary and noncontributory wording its own policy sits excess. Our guide to additional insured endorsements covers the full family of forms and their wording traps.
Everything the endorsement grants, it caps. Coverage applies only to liability caused, in whole or in part, by the named insured's acts, omissions, or work, so the additional insured's sole negligence is not covered under post-2004 ISO editions. New York's high court put a price on those six words in Burlington v. NYC Transit Authority,[1] holding in 2017 that "caused, in whole or in part" requires proximate causation by the named insured. Because NYCTA had admitted sole responsibility for a cable one of its contractors struck, the endorsement gave the Transit Authority nothing on a claim it settled for $950,000. The additional insured brings no limits of its own, sharing the named insured's per occurrence and aggregate, and it has no authority over the policy and no cancellation notice unless a separate endorsement adds one.
None of this shows up on a certificate. Additional insured status is evidenced by the endorsement, while the ACORD 25 certificate is information only and does not alter the coverage described. A certificate claiming status the policy never granted manufactures E&O exposure for the issuing agency, and failing to add or correctly identify an additional insured drives 36 percent of the roughly 1 in 25 agency E&O claims that involve a certificate, per IIABA's Certificates of Insurance: Issues and Answers white paper.[2]
How do the two statuses compare side by side?
The two tiers side by side:
| Named insured | Additional insured | |
|---|---|---|
| How status is created | Listed in the declarations | Endorsement, scheduled or blanket, usually triggered by written contract |
| Scope of coverage | Full policy scope for its own operations | Only liability arising from the named insured's work or relationship, never its own sole negligence |
| Limits | Shares policy limits, controls their size at purchase | Shares the same limits, adds none, and current editions pay the lesser of contract or limits |
| Policy changes | First named insured may request changes for all insureds | No authority over the policy at all |
| Cancellation notice | Sent to the first named insured | None, unless a notice endorsement is purchased |
| Duration | Full policy term, renewable | Ends with the policy, the project wording, or the contract that triggered it |
Read down the additional insured column and every row narrows coverage or strips a right the named insured keeps.
If you need verification of coverage, obtain the declarations page for the named insured. Verify the additional insured status through obtaining the actual endorsement and comparing the legal name of your client to the name listed on the schedule. The reason for this is that when verifying coverage as an additional insured, adjusters will strictly interpret their obligation to review and include only those parties listed on the schedule.
Frequently asked questions
What is a named insured able to do that an additional insured cannot?
The named insured operates the policy: it is responsible for requesting changes to the terms and conditions of coverage, it is entitled to receive any applicable refunds of premium, it is the party billed by the carrier, and it is the party notified at cancellation. It also has coverage for its own independent operations, while the additional insured can only tender claims tied to the named insured's work.
Can a policy have more than one named insured?
Yes. Multiple entities can be listed, and nothing in the Commercial Lines Manual requires common ownership, though carriers apply their own underwriting rules. The entity listed first becomes the first named insured and takes on the premium, notice, and change duties for the whole group.
Does an additional insured get its own limits?
No. All insureds share the named insured's per occurrence and aggregate limits, and no standard additional insured endorsement increases them. Current ISO editions also cap recovery at the lesser of what the contract requires and the limits available. Adding a true operating entity as a mere additional insured, rather than a named insured, leaves its independent operations bare.
This guide is for educational purposes and summarizes standard ISO policy language. Your policy's specific terms, conditions, and endorsements control. Talk to a licensed broker about your actual exposures.
The Bottom Line
A named insured owns the policy and holds its full rights and duties. An additional insured borrows a thin slice of that coverage, limited to liability from the named insured's work, capped at shared limits, and carrying no notice rights. Before you rely on either status, pull the declarations for a named insured and the endorsement for an additional insured, then read the granting language against the contract that demanded it.
References
- 1.New York Court of Appeals. “Burlington Insurance Co. v. NYC Transit Authority.” Accessed July 2026. https://www.leagle.com/decision/innyco20170606321 ↩
- 2.IIABA. “Certificates of Insurance: Issues and Answers.” Accessed July 2026. https://www.independentagent.com/vu_resource/certificates-of-insurance-issues-and-answers/ ↩