1. Forms
2. CX
3. CX-24-33

What the form is

The CX 24 33, titled "Noncontributory – Other Insurance Condition," is an endorsement to the ISO Commercial Excess Liability Coverage Part (CX 00 01). Its primary function is to alter how the excess liability policy interacts with other insurance policies, specifically those under which an additional insured on the excess policy is a named insured. When this endorsement is attached and applicable, the excess insurer agrees not to seek contribution from the additional insured's own insurance policy. This means the excess policy will pay without looking for reimbursement from the additional insured's policy, even if that policy would otherwise be considered primary or contributing. It's important to note that this endorsement typically addresses the 'noncontributory' aspect but not necessarily the 'primary' aspect of coverage for the additional insured.

Classes of business it applies to

This endorsement is used in conjunction with a Commercial Excess Liability policy (CX 00 01) and can apply to a wide range of commercial enterprises that utilize such excess coverage. It becomes particularly relevant in situations where contractual agreements require the named insured to provide insurance to another party (the additional insured) on a noncontributory basis.

Real-world examples include:

• Construction Projects: A general contractor (named insured) might be required by contract to provide excess liability coverage for the project owner (additional insured) on a noncontributory basis. If a covered claim implicates both parties, this endorsement would prevent the general contractor's excess insurer from seeking contribution from the project owner's own liability insurance.
• Landlord-Tenant Agreements: A tenant (named insured) might be contractually obligated to provide noncontributory excess liability coverage to the landlord (additional insured) for liabilities arising out of the leased premises.
• Service Agreements: A vendor or contractor (named insured) providing services to a client (additional insured) may be required to ensure their excess liability coverage is noncontributory with respect to the client's insurance.

Special considerations

• Written Agreement Required: The endorsement typically requires that the named insured has agreed in a written contract or agreement that the insurance provided to the additional insured must be noncontributory.
• Scheduled Endorsement: The additional insured person(s) or organization(s) to whom this noncontributory status applies must usually be listed (scheduled) on the endorsement itself or in the Declarations.
• Interaction with Primary Insurance: While this endorsement makes the excess coverage noncontributory, the underlying primary general liability policy must also address the primary and noncontributory requirements for the additional insured. This endorsement for the excess policy works in concert with how the underlying layers are structured.
• Distinction from "Primary" Coverage: It's crucial to understand that "noncontributory" does not automatically mean "primary." An endorsement might make the coverage noncontributory without making it primary over all other policies the additional insured might have. The order of response is a distinct, though related, issue. A newer, comparable endorsement, CU 24 77 12 23 for umbrella policies, explicitly addresses both "Noncontributory and Order of Response."
• Policy Language is Key: The exact wording of the endorsement and the main policy can vary, so it's essential to read them carefully to understand the full scope and limitations.

Key information for agents and underwriters

• Risk Transfer Verification: Agents should ensure this endorsement is added when their client has contractual obligations to provide noncontributory excess coverage to an additional insured. Underwriters need to assess the increased risk exposure, as the policy may not be able to recover funds from the additional insured's other insurance.
• Contractual Review: It is vital to review the underlying contracts that dictate insurance requirements to ensure the endorsement aligns with the agreed-upon terms. Mismatches can lead to disputes and coverage gaps.
• Underlying Coverage: Underwriters should confirm that the underlying primary policies are also endorsed correctly to provide primary and noncontributory coverage for the additional insured, as the excess policy's response often depends on the underlying coverage.
• Pricing Implications: Modifying the 'Other Insurance' condition to be noncontributory can potentially increase the insurer's exposure, which might have pricing implications.
• Clarity for Additional Insureds: This endorsement provides greater certainty to additional insureds that the named insured's excess policy will respond without seeking contribution from their own insurance, assuming all conditions are met.
• Potential for Disputes: Despite such endorsements, disputes over which policy pays can still arise, especially in complex claims involving multiple parties and insurance layers. Clear contractual wording and correctly endorsed policies are key to minimizing such disputes.