Company Was Additional Insured Under GL Policy Even by General Designation and Not Specific Name

A second-tier subcontract required the sub-sub to provide insurance naming, as additional insured parties, both the first-tier sub, and also "the Project owner and construction manager." When the sub-sub’s employee was injured and sued the construction manager and the first-tier sub, both companies sought a defense and indemnity from the second-tier sub.

The carrier argued that Shawmut, the construction manager, was not named in the sub-subcontract and was thus not an additional insured, and no indemnity or defense obligation existed. It argued that the policy language noted below required a single agreement between the insured sub-sub and the construction manager, for the latter to have additional insured status:

Who Is An Insured is amended to include as an additional insured any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy. [emphasis in original]

The Court of Appeal made short shrift of that argument. It was not necessary for the sub-sub and the prime to have an agreement with each other. It was simply sufficient for the contract to adequately convey what parties – by name or by designation – were to have additional insured status. The sub-subcontract did so. The lower court decision, that the carrier owed a defense and indemnity to the construction manager, was upheld. The case is First Mercury Ins. Co. v. Shawmut Woodworking & Supply, Inc., 2016 U.S. App. LEXIS 16152 (August 29, 2016) (LEXIS subscription required).