KEN KIRSCHENBAUM, ESQ
KIRSCHENBAUM & KIRSCHENBAUM PC
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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more on Providing additional insured coverage

August 17, 2026

more on Providing additional insured coverage

 from article on August 6, 2026

 

Ken,
     You asked a ton of questions, so this may be a long response, but it is important to understand.  I’m happy to do a webinar explaining more about this.
 
Additional insured requests are one of the most misunderstood aspects of commercial general liability (CGL) insurance. Alarm companies should approach these requests carefully because the insurance requirements contained in customer contracts often exceed what the policy actually provides.
1. Does every broker have authority to issue an Additional Insured certificate?
Not necessarily.
A distinction should be made between issuing a Certificate of Insurance (COI) and granting Additional Insured (AI) status.
  • A broker or agent may have authority to issue a Certificate of Insurance that accurately reflects the policy.
  • However, a broker cannot create coverage by simply checking the "Additional Insured" box on a certificate.
  • Additional Insured status must already exist through:
    • an endorsement attached to the policy, or
    • a blanket endorsement that automatically grants Additional Insured status when required by written contract.
If no endorsement exists, the broker generally must obtain approval from the insurance carrier before representing that a party is an Additional Insured.
A Certificate of Insurance is evidence of insurance only. It does not amend, extend, or alter coverage. This is why ACORD certificates include prominent disclaimer language.
 
2. What's the difference between a Certificate Holder and an Additional Insured?
Certificate Holder
A certificate holder simply receives evidence that insurance exists. Being listed as a certificate holder:
  • does not provide liability coverage
  • does not make the holder an insured
  • generally, does not provide cancellation notice unless specifically required by the policy and state law
Many customers mistakenly believe a certificate holder has rights under the policy. They generally do not.
Additional Insured
An Additional Insured becomes an insured under the policy, but only to the extent provided by the endorsement.  The endorsement, not the certificate, defines:
  • who qualifies
  • what operations are covered
  • what claims are covered
  • the duration of coverage
  • any limitations
Again, the COI merely reflects the policy; it does not create those rights.
 
3. Can the broker limit Additional Insured coverage by wording on the Certificate?
Generally, no.  This is probably the most important point.  Any language placed in the Description of Operations section of the certificate usually doesn’t have merit:
"Coverage limited to acts of the named insured."  Or
"Subject to K&K contract."
This language has no effect on policy coverage unless that same limitation appears in the policy endorsement itself.
Courts consistently hold that:
  • the insurance policy controls;
  • endorsements control;
  • certificates cannot modify the insurance contract.
Therefore, if the Additional Insured endorsement provides broader coverage than intended, adding restrictive wording to the certificate generally will not narrow that coverage.
 
4. Why do carriers issue Additional Insured endorsements so readily?
There are several reasons.
First, Additional Insured coverage has become an industry standard in commercial contracting. Many customers, landlords, property managers, and general contractors require it before doing business.
Second, modern ISO endorsements have become much more restrictive than older versions.  Most current endorsements limit coverage to:
  • liability caused, in whole or in part, by the named insured's acts or omissions;
  • ongoing operations;
  • completed operations (only if separately endorsed); and
  • the extent permitted by law.
Many also limit coverage to what is required by written contract.  So, while carriers routinely issue Additional Insured endorsements, they are not necessarily providing unlimited protection.
 
5. What should Alarm Companies consider before agreeing?
From a risk management standpoint, caution is warranted.
The purpose of well-drafted alarm contracts (K&K agreements) is to:
  • limit liability,
  • allocate risk,
  • obtain indemnification,
  • and reduce litigation exposure.
Granting broad Additional Insured status can shift defense obligations to the alarm company's insurer, potentially increasing:
  • defense costs,
  • claim frequency,
  • loss ratios,
  • future premiums,
  • underwriting scrutiny, and
  • renewal challenges.
While many Additional Insured endorsements are limited to liability arising from the alarm company's work, they can still significantly increase the carrier's defense obligations.
 
Recommendations from The Insurance Center
  • Never assume a Certificate of Insurance can create or restrict coverage.
  • Avoid modifying certificate language in ways that suggest broader or narrower coverage than the policy provides.
  • Have legal counsel (K&K) review contractual indemnity and insurance requirements before agreeing to them.
 
Summary
A Certificate of Insurance is evidence of insurance—not a coverage document. Additional Insured rights come solely from the policy endorsement, and any limitations on coverage must be contained within that endorsement, not on the certificate itself. Alarm companies should be cautious about agreeing to broad Additional Insured obligations, particularly when their contracts are otherwise designed to limit liability. As insurance producers, our role is to ensure that contractual insurance requirements align with the actual coverage provided by the policy and to help clients understand the potential underwriting and claims implications of extending Additional Insured status.
 

Shawn Iverson, CIC

The Insurance Center        

801-622-2626 ph/fax/text

www.AlarmInsuranceCenter.com

 
Response

Thanks to Shawn for his expertise and willingness to share that knowledge.  Shawn is not only the leading go to insurance broker in the alarm industry, but he is expert in most insurances.  In fairness there are other insurance brokers listed on The Alarm Exchange, though known who contribute their knowledge as frequently as Shawn [and they are welcome to]. 

Be sure that you understand what you have agreed to in any contract you sign. The Kirschenbaum Contracts TM do not require you to carry insurance, though the updated contract versions do reference that some levels of your exposure is limited to your insurance coverage, so that does imply you will carry insurance.

Rule of thumb is agree to name subscriber as Certificate Holder, but not additional insured.  If you do name subscriber as additional insured, especially if you have committed to do that contractually [which you will be doing if you sign the subscriber's agreement] make sure your policy has that coverage because just putting it in the COI will not create the additional insured coverage.

Also, if you do name subscriber as additional insured be aware that the coverage will be limited to your acts of negligence and will not cover damage or loss if you are not negligent.  You don't want any contractual undertaking to be more inclusive than that coverage, which is all that is available to you under your policy..

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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