Additional insureds are insureds that are afforded coverage in a policy other than their own.  There are many types of additional insured endorsements available. The most common in the food and beverage space is the Additional Insured Vendor. A very common contract request. Certificate holders, on a COI, are not automatically additional insureds. Coverage must exist in the policy before it is noted on a certificate of insurance.

These are not terms you will find in an insurance policy but describe two segments of the property and casualty insurance marketplace. In simple terms, if your policy includes fees such as brokers fees or policy fees along with state taxes, it is likely a non-admitted policy. This insurance market is also known as the Excess or Surplus lines marketplace. Disclosures are often included with your quote and policy. 

If your policy does not have extra fees and state taxes, it is likely you have an admitted insurance policy. 

So why the difference? Admitted insurance products undergo more state regulation of the insurer, policy terms and rates charged. If an insurer becomes insolvent, states have funds to offer payments to policyholders.  

Non-admitted insurance companies do not have insolvency funds available and are not as regulated for policy terms and rates charged. States will monitor insurers eligible to offer non-admitted insurance policies. The result is non-admitted insurance companies can insure products that admitted companies shy away from. Non-admitted insurers play a vital role in the marketplace for certain product types and new businesses.

Batch clauses limit the amount of insurance available per batch. For example, over the course of time several injuries stem from one batch. Even though claims may be reported at different times, the limit of insurance is restricted to all claims associated from one batch. The limit of insurance is not available for each incident. Batch clauses may also limit a deductible to one deductible payment per batch incident, but not in all cases. Batch clauses are more common in non-admitted liability policies.

Bodily Injury is defined in an insurance policy. The definition may vary by policy but usually includes injury, sickness or disease sustained by a person and includes death. Some definitions may also mention mental injury, emotional distress, and mental anguish.

Coverage amount afforded for an insured arising from your premise or operations that results in bodily injury to another or damage to their property. The limit is the most that will be paid per occurrence regardless of the number of suits or claims.

Your Property located in or on the building described in the Declarations or in the open (or in a vehicle) within 100 feet of the described premises, consisting of the following :

Furniture and fixtures;

Machinery and equipment;

Stock

All other personal property owned by you and used in your business; tenant improvements and betterments Leased personal property which you have a responsibility to insure

Not all property may be covered. Policy also includes a Property Not Covered section.

A Certificate of Liability Insurance, commonly referred as a COI is a common request.  A COI illustrates the policies, limits and some coverage terms, at the time the certificate is produced. A COI does not alter the policy, nor does it convey additional insured status unless the policy extends that coverage to a certificate holder.

Claims Made liability is used by insurance companies to control exposures they insure. Often used for supplements, energy drinks, functional products, professional liability and D&O coverage. Product recall may also have components of claims made insurance. Features include a retroactive date and extended reporting periods. Coverage is triggered at the time a claim is made against a policy subject to the retroactive date.

Coinsurance clauses can be found in both property insurance and product recall insurance. This is a familiar term in health insurance and functions much that way in a product recall policy. The policyholder is responsible for a percentage of the loss in addition to any deductible.

Coinsurance functions differently in property insurance. The policyholder agrees to insure covered property at minimum level usually denoted by a percentage (80% is common). The insurance limit may vary based on the valuation method used to value property at the time of a loss. If, at the time of a loss, the limit of insurance is adequate in relation to the coinsurance percentage, there is no deduction from a claim payment. If the insured limit is too low, a penalty will be assessed by reducing the amount paid for a loss.

The coverage territory outlines where a covered incident can occur. Liability policies often include the US, territories, possessions, Puerto Rico and Canada. Products may be covered worldwide but often the legal action needs to be within this stated coverage territory, which is not always feasible. Some liability policies can offer worldwide product coverage without this restriction. 

Property insurance may have a more restrictive territory. Traditional property insurance is usually centered at a specific address and a small radius beyond that address. 

Ocean Cargo policies offer worldwide coverage or may have country or route restrictions.

Property insurance may include deductibles that are a flat dollar amount, a percentage and or by days or hours. The type of deductible can vary by coverage and insured peril. 

Deductibles can also apply in General or Products liability on per claim or per occurrence basis. Per claim deductibles may apply per person filing a claim and occurrence deductibles to related incidents.

Directors & Officers insurance or D&O is decision making insurance. If directors or officers fail to perform their duties, stakeholders of the company may incur financial harm. This policy offers protection for the company and its directors/officers.

An extended reporting period is a feature of a claims made insurance policy. Reporting periods become important when a policy is not renewed or is cancelled. Due to the functionality of a claims made policy, a policy needs to be in place in order to file a claim. Extended reporting periods allow the use of a policy, that has not been renewed or is cancelled, a longer period of time to file claims. 

Policies can vary but in general can include both a basic and a supplemental extended reporting period. Basic extended reporting periods may be included in a policy with a 30-to-60-day timeframe. Supplemental periods must be purchased with time frames of reporting, one, two or three years are common. Pricing is a percentage of the last annual premium paid, for example, 100% for one year or 150% for two years.

Payment of extra expenses above and beyond normal operating expenses due to a covered property claim.

The amount that will be paid for covered Liability occurrences in one policy year. The General Aggregate resets at the policy renewal. Product and completed operations claims are not included in this aggregate.

This coverage is not Auto coverage as you may know it. It applies as an excess coverage to your business if a hired (rented) or non owned (perhaps an employee owned vehicle) is used in your business and the insurance on that vehicle is not in effect or the limits are insufficient to pay the loss. This coverage can be added to General Liability or it can be attached to a Commercial Auto policy.

Liquor Liability or Dram Shop liability covers bodily injury or property damage resulting from the intoxication of a person. General and Product Liability do not provide coverage.

Payment of necessary medical expenses incurred by another resulting from injury stemming from your operations(other than your products and completed operations). Unlike liability coverage, negligence is usually not an issue and is paid on a per person basis.

Minimum premium as the name suggests, represents the minimum amount of premium an insurance company will charge to insure a risk. Minimums can apply if the policy is cancelled during the policy term but can also be a factor in auditable policies. Premium amounts are designated by flat dollar amounts and percentages of annual premiums.

Mold and Fungi exclusions are common in both liability and property policies. Liability policies can range from a total exclusion for injuries sustained by mold or fungus to exclusions that allow coverage for consumable products. Property insurance may have a complete exclusion.

A common contract term located in the insurance portion of a wholesale contract is a notice of cancellation. One of the parties in the contract, for example a distributor, may require notice if a manufacturer's insurance policy is being cancelled. Thirty days of advance notice is common. However, insurers vary on how to handle these requests. Some insurers offer notice to specific entities listed in the policy. This requires a change to an insurance policy. Others may require the agent or broker to report back on any entity requiring notice. Some insurers will not offer notice of cancellation. Insurers do not notify third parties when changes are made to a policy. Notice is typically not sent for cancellations associated with non-payment of premium.

Occurrence liability is the most common type of liability policy and is the counterpart of Claims Made liability. Coverage is triggered at the time of an occurrence. Claims are filed against the policy in place at the time of the occurrence, not necessarily the policy in place at the time the claim is filed.

Ocean cargo policies require covered property, at some point in the journey, to move over water. However, these policies can extend coverage for inland transit as well as warehouse storage.

A past liability exclusion functions very much like a retroactive date included in a claims made insurance policy. However, a past liability exclusion can appear in an occurrence policy form as well. The intent of the exclusion is to limit the insurers’ exposure to products that have been in commerce prior to the effective date. Exclusion wording varies but can include products manufactured, sold and distributed. The date usually will stay fixed, like a retroactive date, as policy terms are renewed.

Personal and Advertising Injury are combined in the same definition. This definition includes false arrest, malicious prosecution, wrongful eviction, slander, libel, violation of privacy and may include limited infringement of copyright, slogan in an advertisement (which often is defined).

This limit applies to losses associated with libel, slander, defamation of character and unintentional copyright or trademark infringements used in advertising material. This coverage is not a substitute for intellectual property coverage and is limited to advertising.

Premium Audit is a condition in many General or Products liability policies. This condition can also be found in Product Recall, Umbrella/Excess Liability and Ocean Cargo policies. A policy subject to premium audit means the premium paid is an estimate only. The insurance company or a representative they hire will contact a policyholder after a policy expires, to check for actual figures used to rate the policy. Examples of rating exposures are gross sales or values shipped. The expired or cancelled policy premium can be adjusted based on the results.

Primary and noncontributory insurance terms are common in wholesale contracts. For example, a distributor may request a manufacturer's policy be primary insurance and limit the distributor’s insurance contribution to a loss.

The aggregate amount that will be paid in one policy year for bodily injury and property damage losses that result from your product and/or completed operations. Premise and Operations claims are not included in this aggregate.

Coverage for bodily injury or property damage to another resulting from your product or completed operations.

Exclusions exist in General Liability policies for the expenses incurred due to a voluntary or mandatory recall of your product from the market. If coverage has been purchased a limited amount of expense reimbursement is available. Higher limits of coverage may require a separate Product Recall policy.

Property Damage is defined within an insurance policy. Physical injury to tangible property but not electronic data. Loss of use of damaged property and property that is not physically injured is included.

Insuring property (inventory, building or machinery) for the correct limit depends on how property is valued at the time of a loss. Common methods of valuation include:

Actual Cash Value (ACV)-replacement cost at today's prices less depreciation 

Replacement Cost-the cost, at today's prices, to replace property with like kind and quality 

Selling Price (manufacturers price)-used for finished product and valued at the price it would be sold less discounts if applicable.

Covered property will be paid with no deduction for depreciation. May not apply to all covered property and is usually subject to coinsurance (a requirement for a minimum amount of insurance to be carried).

A retroactive date is a key component of a claims made liability policy. Occurrences on or after this date can be covered based on other policy terms and conditions. If an incident occurred before this date, it would not be afforded coverage. It is important to review retroactive dates when purchasing claims made liability insurance.

Hiring experts, obtaining reports, hiring counsel, loss of work of insureds are examples of expenses associated with the claim process. These expenses are often paid by the insurance company. Expenses may or may not reduce the limits of liability. Claims made liability policies often have provisions that expenses reduce the limits of liability.

Umbrella Liability and Excess liability or often used interchangeably. The forms function to offer extra limits of coverage above and beyond "underlying policies". It is common for insurers to offer General or Product Liability to $1,000,000 and no further. Umbrella or Excess liability policies are separate policy numbers that add insurance limits above $1,000,000. These policies respond only when the underlying insurance limits are exhausted.

Resulting loss of income due to loss of; utility services from a covered cause of loss to Power, Water or Communication services.

Subrogation allows an insurance company to collect from a negligent third party if the insurer has paid a claim on behalf of their insured. Many contracts request a waiver of this right to prevent each party’s insurer from attempting to collect from the parties to the contract. A waiver of subrogation requires a change to a standard policy and can be done on a blanket basis or specifically scheduled for a particular party.

Workers Compensation is mandated in most states. It is designed to be the "sole remedy" for "on the job" injuries to employees. Independent contractors are not covered but should be explored carefully. Important factors that impact coverage and premiums include payroll amounts, location of employees and job duties. Coverage limits follow state workers compensation laws, so it is important for the right states to be designated on the policy.