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Where the pleadings allege that a downstream party was the proximate cause of the loss, there will likely be no argument that the downstream insurer owes at least a defense under AI coverage. However, where the downstream party is the employer, there is a greater likelihood of disputes over AI coverage. (Credit: JaysonPhotography) Where the pleadings allege that a downstream party was the proximate cause of the loss, there will likely be no argument that the downstream insurer owes at least a defense under additional insured coverage. However, where the downstream party is the employer, there is a greater likelihood of disputes over additional insured coverage. (Credit: JaysonPhotography)

In a significant break with case law, the Court of Appeals ruled in Burlington v. NYC Transit Authority that additional insured endorsement on a commercial general liability (CGL) policy is “restricted to liability for any bodily injury caused in whole or in part by the acts or omissions of the named insured, the coverage applies to injury proximately caused by the named insured.”

Appellate case law had previously held that, where the named insured’s employee was injured, the employment relationship alone was sufficient to trigger additional insured coverage for endorsements with this wording, which includes most of the current 04 13 and 12 19 Insurance Service Organization (ISO) forms.

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