Named Insured

Who is the named insured? The insurance answer is that the policy holder is always one of the named insured. The named insured has the right to make changes to the policy.

In insurance you often hear of the first, second and third parties. The named insured is first party to the contract. The second party is the insurance company that issues the policy. The third party is a person outside of this contract.

What if someone was hurt in your home? This person now sues you for negligence. You will be the named insured and the defendant in the suit. The insurance company examines your policy and determines if coverage is in force. If the answer is yes, then the insurance company starts the process of defending you. If necessary then the insurance company will pay out on a valid claim.

It is extremely important that the person or company that has actual ownership of what is being insured is named on the policy. This should be discussed with your agent or broker.

An example of such a situation is where a person owns an automobile but does not have a driver's license. This automobile has to be insured in the name of the actual owner. The drivers of the vehicle are then declared to the insurance company.

Another named insured situation is on title to property. Your insurance policy should reflect the names as shown on the title. It is usual to have a mortgage and when the insurance is put in place all names must be shown on a binder document presented to the lawyer. If you have had a change in title then you should contact your agent, broker or insurance company.