Insurance & LiensQuestion 575 of 1605
A subcontractor is added as a "named insured" rather than only as an "additional insured" on the prime contractor's builder's risk policy. Practically, the named insured status differs because the named insured:
a.Has direct rights and duties under the policy, including the right to make a claim and the obligation to pay premium
b.Is automatically barred from any recovery if a covered loss occurs
c.Is treated like a third-party claimant with no direct policy rights
d.Loses any protection once the project is more than 50% complete
Explanation
A named insured is a primary party to the policy with direct rights (to file claims, receive notices, etc.) and obligations (such as premium payment and cooperation). An additional insured has narrower, derivative coverage tied to the named insured's work and policy terms.
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)