additional insured vs additional interest

[Maria Teo]

I always request my property manager be listed as "additional insured". During my most recent renewal, my carrier changed the language to "additional interest". My broker assured my property manager they will receive the same coverage as before, however internet articles claim
 additional insured  "is not covered by the polity for any liabilities arising out of your business."

"https://www.thimble.com/small-business-insurance/additional-...
https://www.propmhomes.com/blog/additionally-insured-v-addit...

I plan to circle back with my broker but does this check with what others have heard? Is this a new insurance trend?

[Courtney Urbanek]

Maria,

Additional Interest is anyone who has vested interest in the property and is not the policyholder. Typically, this would be lenders or mortgagees so that they are notified in the event there is a lapse in coverage or a non-renewal. Additional Interests are not afforded coverage through your policy and cannot make policy changes or file a claim.

Additional Insured is anyone afforded coverage under a Property or Premises Liability policy who is not the policyholder but has the authority to make a claim on the policy or has an insurable interest in the property. Additional Insureds may be listed on claim payments if they are also a Loss Payee.

When you hire a property manager, the PM takes on a lot of risk that their insurer may not cover. And when something goes wrong, the PM is often the target of any resulting litigation along with the landlord. Adding the PM as an Additional Insured means that any coverage you have is extended to them. This makes the claims and litigation process easier because the PM and landlord are represented by the same insurance company. Without being listed as the Additional Interest, the PM would have to take on costs upfront and then seek reimbursement from your insurer.

Hope this helped!