What is an additional insured and what are the pro's & con's?

An additional insured is: Reasons to add or want to be added as additional insured: 1) Close relationship with the additional insured 2) Business relationship with the additional insured, and, typically, a contractual agreement to add 3) Act's as a safety net if the hold harmless agreement is unenforceable 4) Secure direct policy rights with respects to defence costs 5) Prohibit subrogation action 6) Provide vicarious liability for the named insured's actions and/or direct liability for additional insured's actions Obtain personal and advertising injury coverage Problems for the named insured by adding additional insureds: 1) Dilution of policy limits - The sharing of limits 2) Exhaustation of limits 3) Unintended coverage provided 4) Defense conflicts 5)Compliance problems Problems for the additional insured: 1) Loss of defense control 2) Increased probability of disputes over coverage 3) Other insurance conflicts - equal shares verses primary and non-contributary 4) Coverage ...  more