What it does
In the base coverage form, newly acquired or formed organizations (other than partnerships, joint ventures or LLCs) get automatic named insured status. CG 24 54 replaces that provision so that any organization other than a partnership or joint venture, including an LLC, over which the named insured keeps ownership or majority interest, qualifies as a named insured if no other similar insurance is available.
Who needs it
Developers and property investors that form a new LLC for each property, contractors forming project entities, and growing companies that acquire LLC-structured businesses.
Key provisions and limits
- Coverage lasts until the 90th day after acquisition or formation, or the end of the policy period, whichever is earlier.
- No Coverage A for injury or damage that occurred, and no Coverage B for offenses committed, before acquisition or formation.
- Rewrites the last paragraph of Who Is An Insured so the exclusion of unnamed LLCs does not apply to those qualifying under the endorsement.
Quoting and selling notes
- Still report new entities so they can be added as named insureds before the 90 days run out.
- Introduced with the 12 19 edition; CG 34 35 through CG 34 38 are versions for other coverage parts.
