What is the most common error made, when applying for Special Event Liability coverage, online?
Amazingly enough, it’s the name of the Insured on the Policy, is most often entered incorrectly. I know, RIGHT??? If there’s one single piece of information that you would think everyone would know, and be able to answer correctly – it’d be their own name, or the name of their organization, right?
Unfortunately, time after time, in application after application, the most common mistake made by the Event Organizer, is that they put the wrong name in the space on the application, where it asks for the name of the Insured, on the Special Event Liability Insurance Policy.
In most instances, it’s not their fault; They are most often in unfamiliar territory, in buying a new kind of insurance coverage for the first time and they are being told by the Venue’s management team, not only that this insurance is required – but that the Venue must be named on the policy – and THAT is usually where the confusion lies.
The Prospective Insured (The Event Organizer), then mistakenly applies for the Insurance under the name of the Venue instead of under their own name, or the name of their organization.
The Venue Manager isn’t intentionally sending the Prospective Insured off in the wrong direction, they just don’t realize that there’s any confusion. In many cases, they’ve simply been given a requirement sheet from an attorney or a legal department, and told to make sure everyone complies with it. In some cases, they’ve just been told to require that everyone who holds an event, “name us on the Policy”.
The confusion is twofold: There’s a lack of understanding of the terminology but also of the overall, “big picture”.
All too often, neither the Prospective Insured, nor the Venue’s Manager fully understands how this arrangement should be structured, so the Venue Manager doesn’t provide clear instruction to the Prospective Insured, who subsequently makes their submission in error.
The confusion regarding the terminology has to do with 2 similar but ultimately, VERY different terms: “Insured” and, “Additional Insured”. These are not the same thing.
There can be multiple Additional Insureds (Also called Certificate Holders) but there can only be one Insured on any Special Event Liability policy…
Who should that be?
It is very simple, really: The Insured should always be whomever is entering into an agreement with the Venue, to hold an event on the Venue’s property – or in their facility. One simple and easy-to-remember rule of thumb is as follows: The name of the Insured on the Policy should match the name on the rental agreement/contract, with the Venue.
So, when the Venue Manager tells an Event Organizer that the Venue should be, “named on the Policy”, they aren’t saying that the Venue should be the Insured. The Venue cannot be the Insured because this coverage is intended to accompany a rental agreement/contract between an Event Organizer and the Venue Owner. The Venue should only be named as, “Additional Insured”.