{"id":896844,"date":"2019-12-12T15:18:46","date_gmt":"2019-12-12T22:18:46","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=896844"},"modified":"2019-12-12T15:18:54","modified_gmt":"2019-12-12T22:18:54","slug":"ruling-offers-key-safeguards-for-additional-insureds","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/ruling-offers-key-safeguards-for-additional-insureds\/","title":{"rendered":"Wash. Ruling Offers Key Safeguards For Additional Insureds"},"content":{"rendered":"\n

Catherine L. Doyle and Brian S. Scarbrough | Jenner & Block<\/a> | November 27, 2019<\/p>\n\n\n\n

It is common in certain commercial relationships for contracting parties to agree that one will obtain insurance and name the other as an \u201cadditional insured\u201d on the policy. For example, these arrangements are often seen in the construction industry, between vendors and vendees, and between service providers and manufacturers.<\/p>\n\n\n\n

The obvious benefit to the additional insured is the protection of coverage that it does not have to purchase on its own behalf. However, because the additional insured is outside of the relationship between insurer and policyholder, the additional insured usually does not have access to all policy-related documents.<\/p>\n\n\n\n

In order to demonstrate that the other party did, in fact, procure the contractually required coverage, it is common for the additional insured to receive a certificate of insurance, or COI, that sets forth the limits of coverage and identifies parties insured under the policy. The COI may be issued by the policyholder\u2019s insurance broker or by the insurance company\u2019s agent.<\/p>\n\n\n\n

Where there are inaccuracies on the COI \u2014 where the COI indicates that coverage exists beyond the scope of the actual policy \u2014 the additional insured could be at risk. The question of coverage for a would-be additional insured, as indicated on a COI but not in the policy, has been hotly litigated.<\/p>\n\n\n\n

The Supreme Court of Washington, in T-Mobile USA Inc. v. Selective Insurance Company of America, recently strengthened the protections afforded to an additional insured where the inaccurate COI was issued by the insurance company\u2019s agent. In T-Mobile, the Supreme Court of Washington answered, in the affirmative, the following question certified from the United States Court of Appeals for the Ninth Circuit: \u201cWhether an insurance company is bound by its agent\u2019s written representation \u2014 made in a certificate of insurance \u2014 that a particular corporation is an additional insured under a given policy.\u201d <\/p>\n\n\n\n

T-Mobile Northeast engaged a contractor to assist with the construction of a rooftop cell phone tower. Pursuant to the contract between T-Mobile Northeast and the contractor, the contractor was to obtain general liability insurance, to provide T-Mobile Northeast with COIs evidencing the coverage on an annual basis, and to name T-Mobile NE as an additional insured under the policy. <\/p>\n\n\n\n

The contractor purchased such a policy from Selective Insurance Company of America. The policy included a provision extending coverage to third parties, like T-Mobile Northeast, to whom the contractor obligated itself in a separate contract to add as additional insureds under its insurance policy.<\/p>\n\n\n\n

T-Mobile Northeast\u2019s parent company, T-Mobile USA, was not a party to the contract between T-Mobile Northeast and the contractor, although T-Mobile USA did approve the contract as to form. The terms of the policy therefore did not confer additional insured status on T-Mobile USA. However, Selective\u2019s agent issued numerous COIs over approximately seven years to \u201cT-Mobile USA Inc., its Subsidiaries and Affiliates\u201d stating that they were \u201cincluded as an additional insured\u201d for certain coverages under the policy. <\/p>\n\n\n\n

The COIs were industry-standard forms with industry-standard disclaimers including, in bold capital letters, that the COI <\/p>\n\n\n\n