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10.4 Section II – Who Is An Insured

The Declarations page identifies the named insured under the Commercial General Liability (CGL) policy. Section II – Who Is An Insured then extends insured status to certain other persons or organizations, depending on how the named insured is listed on the Declarations page. The following persons or organizations are considered insureds, but only with respect to the conduct of the insured business:

  • If the named insured is an individual, such as a sole proprietor, the individual and the individual’s spouse are insureds.
  • If the named insured is a partnership or joint venture, the partnership or joint venture is an insured. Its members, partners, and their spouses are also insureds.
  • If the named insured is a limited liability company (LLC), the LLC is an insured. Its members and managers are also insureds.
  • If the named insured is a trust, the trust and its trustees are insureds.
  • If the named insured is another type of organization, such as a corporation or nonprofit organization, the organization is an insured. Its executive officers and directors are insureds with respect to their duties, and its stockholders are insureds with respect to their liability as stockholders.

A person or organization is not automatically considered an insured simply because it is connected to a past or current partnership, joint venture, or limited liability company (LLC). To qualify as an insured, that person or organization must be specifically listed as a named insured on the Declarations page.

Even if they are not specifically listed on the Declarations page, certain persons or organizations may still qualify as insureds while performing duties related to the conduct of the insured’s business. These additional insureds include:

  • The insured’s volunteer workers and employees, other than executive officers, directors, or managers;
  • Any person acting as the insured’s real estate manager;
  • Any person or organization that has temporary custody of the insured’s property if the insured dies; and
  • The insured’s legal representative if the insured dies, but only while performing duties as the legal representative.

Newly acquired or newly formed organizations may also qualify as insureds under the CGL policy. However, this automatic insured status does not apply to newly acquired or formed partnerships, joint ventures, or limited liability companies (LLCs). For a newly acquired or formed organization to be insured, the named insured must maintain ownership or majority interest in the organization. In addition, no other similar insurance may be available to that organization. Coverage for a newly acquired or formed organization is temporary. It applies for only 90 days after the organization is acquired or formed, or until the policy expires, whichever occurs first.