To embed, copy and paste the code into your website or blog: In a previous post , we addressed blanket additional insured endorsements and the role they play in passing insurance obligations downstream. In short, the purpose of a “blanket” endorsement is to grant additional insured status to any company as required in a written contract with the named insured. This obligation often begins in the made a post prime contract where the owner requires additional insured status on the general contractor’s insurance. However, the general contractor typically attempts to pass this obligation downstream to its subcontractor by including a requirement in the subcontract that both the general contractor and owner are named as additional insureds. But what happens if there is no written agreement between the named insured and the company seeking additional insured status, or if there are multiple required additional insured entities and only some have contractual privity with the subcontractor? Nationwide, courts are split as to whether direct contractual privity is required to satisfy certain additional insured endorsements. For example, cases decided under Connecticut , Maine and Texas law have held that contractual privity is not required. Courts in New York , Illinois and Louisiana , however, have held that privity is required. Even within jurisdictions, there is not always uniformity on this issue. In New York, for example, a trial court held in All State Interior Demolition Inc. v. Scottsdale Insurance Co. that contractual privity was not required for additional insured status. A previous post discussed that decision in detail but, in sum, the court granted additional insured status to entities that did not contract with the named insured but were referenced in the named insured’s subcontract. In that case, the subcontractor was required to name the contractor, find the Owner and “their respective partners, directors, offices, employees, agents and representatives.” The court read that language in the subcontract broadly and required the insurer to defend the contractor, owner, ground lessor and construction manager under the terms of the additional insured endorsement. However, the New York Court of Appeals found in Gilbane Building Co./TDX Construction Corp. v. St. Paul Fire & Marine Insurance Co. that a construction manager was not covered as an additional insured because that entity did not have a direct contractual relationship with the general contractor.https://www.jdsupra.com/legalnews/is-contractual-privity-required-for-2246259/
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