The “insured” on a commercial insurance policy can be a confusing issue, so I want to talk about determinations of how we arrive at discovery of exactly who is to be placed on the policy as insured. We will always ask the name of the business, but the answer to the next question we ask is critical. We ask what the business entity is. Is it a LLC, partnership, joint venture or incorporated? We may also ask if this is a sole proprietorship if your name is included. The answers provided will determine the name we write the policy for. At claim time, coverage is afforded to the name we have established as the business insured.
If one is a sole proprietor, the named insured and spouse are covered with respect to conduct of the business.
If one is a partnership or joint venture, then the partnership or joint venture is covered along with members, partners and their spouses, but also with only conduct of the business.
A LLC is an insured as are managers, but only with respect to business conduct. Any other organization, such as a corporation, is an insured as are executive officers, directors and stockholders, but there again, only with respect at to the business interest. Same with a Trust; only the trust and trustees are insureds.
Other than the sole proprietorship and partnership/ joint venture descriptions, spouses are not insured unless holding an office within the business operations.
Please talk with your agent about who is covered under you commercial insurance policy. Or call one of ours to discuss this further.
Commercial Insurance.Net, LLC Advisor is not an attorney, accountant or certified financial planner and makes no representations or warranties to that effect. Always check with your chosen professional as to statements made in this blog for your particular situation.