comment on Providing additional insured coverage is no simple matter August 13, 2026

KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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comment on Providing additional insured coverage is no simple matter
August 13, 2026

comment on Providing additional insured coverage is no simple matter from article on August 6, 2026

Ken,
          In my opinion, Security America, at my direction or urging, was the first carrier to lead the industry about pre-qualifying and limiting what was the automatic granting of Additionally Insured endorsements.
          Alarm dealers were unusually consistent about claims they gave to Security America for coverage; they professed that "we did nothing wrong and you need to fight this claim so it doesn't affect my loss runs and future insurance renewal pricing".
          As Claims Administrator did I pay some claims because the alarm dealer was liable? Yes, of course. But I paid claims for the following reasons, 1) because it was a nuisance, yes 2) because the facts were not generally in the dealers favor and a Judge or Jury could grant a larger award, yes, 3) if the dealer didn't have a K&K or an industry accepted contract, yes, and 4) for other various persuasive reasons, yes.
          Let's just restate the danger of granting additional insured endorsements. The party listed on the Certificate can come straight to Security America and file the claim against the policy because its now also their policy.
          But even worse, the alarm company and the insurance company lose all the indemnification provisions of the contract, even from third parties because it is a reverse insurance procurement requirement. This clause was first created in my USA Central Station three party monitoring contract, over 30 years ago with guidance from Ken to defeat the usual subrogation claim.
          If the agent or carrier, other than Security America, does not help the alarm dealer evaluate the request and provide competent guidance to limit the endorsement they are not doing the alarm dealer or our industry any favors.
          I will close with this statement, alarm dealers should be members of your Concierge Client, and those that do not use Security America should definitely be a member of your Concierge Program so they have a place to get the proper guidance they need on this important topic and eventually they are going to need Ken's guidance for sure.
Bart A. Didden
Executive Claims Manager Security America RRG
President U.S.A. Central Station Alarm Corp.
Port Chester, NY
Milford, CT
St. Paul, MN
Pasco, WA
877-872-1266
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Response

          Thanks for the plug for the Concierge Program. Recommending Security America for E&O coverage and the Concierge Program is a winning combination that no alarm company or fire protection company or security company should ignore.
          I want to emphasize a very important legal point so that there is absolutely no confusion on the issue. What you write in the COI, the Certificate of Insurance which is typically issued by an insurance broker, does not change the Additional Insured Endorsement in the insurance policy; only the endorsement itself determines the actual scope of coverage afforded to the additional insured.
          The issue for you as the dealer, on the one hand with the subscriber asking for additional insured coverage, and your insurance company, on the other hand, providing coverage only to the extent stated in the endorsement, is whether the contract you sign calling for additional insured coverage is consistent with the coverage afforded by your policy. Your subscriber gets the COI showing additional insured, but that coverage may be much different, and wholly different, from what the subscriber thought it was receiving.
          The problem usually comes into play when there is a loss. Fire, burglary, whatever the claim may be. The subscriber comes to you, or better yet, goes right to your carrier, submits a claim and asks for reimbursement. The contract with the subscriber required you to provide additional insured coverage, primary and non-contributory, and first in line if there is a loss. Well, there is a loss.
          But your carrier declines coverage or at very least reserves its right to deny coverage because it claims that you, the insured, were not negligent, or at least your negligence hasn't been established or was not the proximate cause for the loss. That doesn't sound the same as "primary and non-contributory".
          The additional insured coverage will only cover the primary insured's negligence; it is not a substitute for the subscriber's insurance coverage and it is not a reinsurer for the subscriber's insurance carrier, no matter what the COI states; only the endorsement language matters. As Bart correctly points out, the COI does not create coverage.
          If you agreed to provide insurance coverage and don't, which is usually coupled with an agreement to indemnify your subscriber for losses, you need to either be dealing with a customer so important that you are willing to risk your entire company, maybe more, or should be in a straight jacket so you can't sign the contract. Join Concierge Program, use the Program, and try and stay out of trouble.

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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com