How to Make Sure the Indemnification and Additional Insured Provisions in Your Next Contract Deliver the Protection Your Company Expects

James S. Carter

Carter, James S.Many companies rely on indemnification and additional insured provisions in their contracts for protection against losses arising from a contractual relationship. Indemnification provisions insulate the company from certain losses by requiring the other party to assume and to indemnify it against those losses. Additional insured provisions add another layer of protection by requiring the other party to arrange for the company to become an insured under the other party’s insurance policies. Ideally, indemnification provisions and additional insured coverage should work together when losses occur to furnish the level of protection the company expected when it entered into the contract.

Unless company representatives read the insurance policy that provides the additional insured coverage, documents_compare_shutterstock_234757165however, they may have little idea how the additional insured coverage works. A recent decision by the Supreme Court of Texas arising out of the Deepwater Horizon oil spill incident illustrates how the interplay between additional insured coverage and wording in an underlying contract can operate to frustrate an additional insured’s expectations of coverage. Continue reading “How to Make Sure the Indemnification and Additional Insured Provisions in Your Next Contract Deliver the Protection Your Company Expects”

Target Data Breach Part 2: The Additional Insured

Erin L. Webb

More information has come to light about the data breach affecting Target, and it highlights the importance of “additional insured” coverage, as well as the need for companies to recognize that sophisticated cyberattacks can affect any company, not just those in the computer or technology industries.  Blogger Brian Krebs reports that the theft of credentials from a heating and cooling (HVAC) company may be linked to the Target breach.

How could it happen?  No details have yet been publicly confirmed, but it is possible that the HVAC company had access to Target’s network so that it could remotely monitor heating and cooling efficiency at multiple Target locations.  If Target’s electronic systems were linked – if one was accessible via another – a path for a hacker from HVAC information to credit card processing may have been possible. Continue reading “Target Data Breach Part 2: The Additional Insured”