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Everyday we receive requests for Additional Insureds, sometimes from the entity wanting to be added as AI. Our normal procedure is to confirm with the Insured prior to making any changes to the policy, but what if you can't get ahold of the Insured and a loss occurs between the time the request came in and the time we confirm with the Insured to process the changes. Specifically, requests from banks come in all the time. These requests sometimes require adding BPP as well as the AI and LP ENDTs. What liability do we as agents take on if, let's say, a week goes by before we can get ahold of the Insured to confirm adding the BPP and AI/LP ENDTs? Is it ultimately the Insureds responsibility to update their policy or do we as Agents and Brokers have the responsibility to make the changes prior to confirming with the Insured?

Shouldn't the AI requestor contact the primary and request the primary to add them? Seems like your adding work for yourselves, when the requestor should be filling out an Change Request for an AI, sending it to the insured to sign, and then giving it to you. If a loss occurs in the the interim, it would be on the insured for not getting it taken care of when the policy was issued or changes made. I would say that you can fill out the Change Request, with policy number etc, and forward it to the requestor to get taken care of.

An additional insured, a bank, or any other additional interest is not your policyholder nor do they have a right under the contract (insurance policy) to make changes. Those instructions can come only from the policyholder. Contact your customer as soon as possible using your standard contact methods (e-mail, voice mail) and document your records. That's your only responsibility. I would NEVER alter a policy or extend coverage to another without explicit instructions from my policyholder.

Listen to the advice given below. NEVER request a change to a policy without specific instructions from the policyholder.

by ForumReader1 » Thu Dec 29, 2011 11:47 am

An additional insured, a bank, or any other additional interest is not your policyholder nor do they have a right under the contract (insurance policy) to make changes. Those instructions can come only from the policyholder. Contact your customer as soon as possible using your standard contact methods (e-mail, voice mail) and document your records. That's your only responsibility. I would NEVER alter a policy or extend coverage to another without explicit instructions from my policyholder.

I do hope you consider the advices given below. You wouldn't want to end up in trouble for altering the policy. Do all the necessary steps that are part of your responsibilities only.

I occasionally get requests from banks asking me to name them as AI/LP for a new loan, and when I check with the insured they tell me not to issue the certificate because they aren't sure they are using that bank for the loan. Always confirm with the insured first.

This is one of my pet peeves. If the insured has leased a vehicle or property, then yes, there is a need for additional insured status. If they merely hold the mortgage, they do not have an interest in the liability operations and should be named loss payee, but not a/i. Sometimes it's like fighting city hall, though, but just yesterday I was successful in explaining this to an equipment rental firm who was not renting the equipment to my client, they were selling it. They got a loss payee, that's all.