Insurance & LiensQuestion 1484 of 1605
When a prime contractor is named as an 'additional insured' on a subcontractor's CGL policy, the practical benefit to the prime is that:
a.The sub's premiums are paid by the prime
b.The prime no longer needs its own liability policy
c.The prime automatically becomes the policyholder
d.The sub's policy may defend and indemnify the prime for liability arising from the sub's work
Explanation
Additional insured status extends the subcontractor's liability coverage to defend and indemnify the prime for claims arising out of the sub's operations. It shifts certain risk to the sub's insurer but does not replace the prime's own policy or transfer ownership of the policy.
Practice all 1605 questions free — no signup required.
Related questions on this topic
- The main purpose of a contractor's Commercial General Liability (CGL) insurance policy is to cover:
- 'Builder's risk' insurance (also called course-of-construction insurance) primarily protects:
- A 'certificate of insurance' (COI) provided by a subcontractor to a prime contractor:
- Which statement best distinguishes a SURETY BOND from an INSURANCE policy?
- An indemnity (hold-harmless) clause in a construction subcontract typically operates to:
- A recorded mechanics lien claim in California must include, among other things, a statement of the claimant's demand, the name of the owner, a description of the site, and:
Last reviewed: · editorial process
Sen Lin, PrepPass Founder · Verified against California CSLB Contractor License Law & Business Exam · How we review
Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)