Welcome to the ABCs of Insurance Claims. Over the next few months, Sherri Walker, Sentinel’s Director of Claims will address an aspect of claims handling for every letter of the alphabet to help provide a better understanding of the claims process.
Y Is For "You"
At some point in our lives, likely amid our teenage angst, we all asked ourselves “Who are you”? The Who even wrote a whole song about it (and now if you’re not singing “Doot Doot… Doot Doot” in your head, I’m going to assume you either don’t know quality music or are in your 20s). While I’m sure to some there is deeply philosophical and complicated answer to that question, in an insurance policy it is much easier.
Who "You" Are In An Insurance Policy
In every policy, there is a section for definitions, and any word that is in quotations will be spelled out in further detail. With respect to your personal insurance, the policy defines “you” as the “named insured” and then typically goes on to include the qualifying members of your household; that is family members who reside in your home that are related by blood, adoption, or marriage. In order to be a “You”, these conditions must all apply.
Thus, a grown child that is related by blood but living in a home of their own does not meet this definition of an “insured”. A cousin who crashes on your couch and then subsequently crashes your car isn’t technically an “insured” either. The simple act of driving your vehicle does not truly make someone an “insured” even if they are afforded some additional coverage under your auto policy. It is important to add that for property purposes, a guest in your home is not entitled to coverage for their belongings under your Homeowner’s coverage either.
In a commercial policy, “You” again refers to named insureds as well as other classes of individuals you may expect, such as company owners, employees, executives, volunteers, and others who are acting on behalf of the company. Beyond those defined parties, we must look at your policy to determine who else may qualify for coverage, such as Additional Insureds.
Additional Insureds
Additional Insureds may be added to your policy for various reasons. They may be a mortgagee or a vehicle lienholder, which is common as they have a financial interest in your property. Beyond that, there can be Additional Insureds added to protect yourself, the third-party, or both of you.
For example, a General Contractor may require to be added to his subcontractor’s general liability insurance, because while in plumbing, “stuff” rolls downhill but in a lawsuit regarding construction defect liability, it tends to roll uphill. On a Builder’s Risk policy, the property owner may require the General Contractor to be added to their property. The General Contractor may require the owner to be added to their policy as well. This means that in the event of a total loss fire on a home under construction, both parties would be protected. In a policy for a leased space, the building owner may require tenants to add them as an additional insured to protect their interests in the space held for rent.
In any type of policy that covers property, it is important to note that if you are seeking to be considered a “you”, you’ll have to have some sort of insurable interest. This means that you must have some sort of financial stake in the property covered. It can be that you are the titled owner or a co-signor on the car listed on the policy. Or maybe you are a contractor that put in a new HVAC system on a credit agreement. Until the balance is paid off, you have a lien that gives you rights to be on the property’s deed.
Sentinel Is Here For YOU
The long and short of it is that to benefit from first party coverages on any insurance policy, “you” must be an insured; whether by policy definition, by coverage extension, or by endorsement as an Additional Insured.
While we hope that a loss never happens to “you”, we know claims are inevitable. Instead of singing “Who are You”, we’re singing “I’ll Be There For You” throughout the process. Contact us today to learn more about how we’re dedicated to Safeguarding Your Success.
