We recently had a client that was confused by these two documents, and wanted to know what their differences were. He was filming in the city of Los Angeles and wanted to know why the City of Los Angeles was asking him for both documents when everyone else was only asking for a Certificate of Insurance naming them as an additional insured.
Generally, ISO endorsements (the industry standard)furnish coverage to the additional insured for liability “arising out of” the named insured’s work, operations, or premises (or some variation on that theme). For example, the March 1997 version (the version currently in use) of the ISO CG 20 10 AI endorsement provides as follows:
“Who Is An Insured (Section II) is amended to include as an insured the person or organization shown in the Schedule, but only with respect to liability arising out of your ongoing operations performed for that insured.”
In January 1999, the California Court of Appeal, in Acceptance Ins. Co. v Syufy Enterprises, 81 Cal Rptr 2d 557 (Cal App 1999), further defined “arising out of” as follows:
“…the ordinary broad meaning of “arising out of,” which as noted above has been regularly applied by California courts in insurance cases. This inconsistency leads to tortured results. In Granite Construction, the negligent loading of the named insured’s truck caused no injury (and no liability) until the named insured’s employee began hauling the load, in the course of which the truck overturned. It is difficult to understand how the driver’s claim did not arise out of the hauling operation in the most direct way, unless one assumes that fault is a predicate for coverage. We do not believe such an assumption is justified by the policy term “liability arising out of operations.” [81 Cal Rptr 2d at 562]”
The Certificate of Insurance, on the other hand, is a document that merely gives evidence of the underlying insurance. It does not in any way alter the policy.
