Named Insured vs. Additional Insured: What's the Difference?

A named insured is a primary party insured by the policy. An additional insured is another party added to the policy because it has a particular relationship or contractual interest in the insured operation.

Those terms are not interchangeable.

For aviation businesses working under airport leases, maintenance agreements and other commercial contracts, the distinction can be important.

What is a named insured?

The named insured is identified on the policy declarations.

The first named insured typically has responsibilities and rights that other parties do not have, including responsibilities relating to premium and policy administration.

For a business, the correct legal entity needs to be identified.

For example, the company actually conducting the aviation operation may be an LLC while real estate, aircraft or other assets are held in separate entities.

Assuming that every related company is automatically insured can create problems.

What is an additional insured?

An additional insured is another person or organization granted insured status under specified circumstances.

Examples in aviation may include:

• Airport authorities
• Landlords
• Customers
• Vendors
• Business partners
• Other parties required by contract

Whether additional-insured status applies—and the scope of that status—depends on the endorsement and policy language.

Why contracts drive this issue

Airport leases and commercial agreements frequently include insurance requirements.

A contract may require one party to:

• Name another organization as an additional insured
• Maintain particular liability limits
• Provide evidence of coverage
• Carry particular endorsements
• Waive certain rights of recovery

That creates a potential disconnect between the contract you signed and the insurance policy you purchased.

Simply issuing a certificate of insurance does not answer whether the underlying policy actually provides everything required by the agreement.

Verify the entities before there is a claim

A useful insurance review should compare:

Legal entities → contracts → policy declarations → endorsements

The goal is to make sure the organizations that need protection are actually treated correctly under the policy.

For FBOs and MROs operating under multiple leases, service agreements and customer contracts, this can become complicated quickly.

If you are unsure whether your entities and contractual partners are properly addressed, Aeris can review the insurance requirements alongside your existing program.

The Aeris target profile specifically identifies airport leases, manufacturer agreements, customer indemnification clauses and contractual insurance requirements as material exposures for its target aviation businesses. Technical distinctions above are adapted from Aeris’s source brief.

Common questions:

• What Insurance Does an FBO or MRO Need?
• Does General Liability Insurance Cover “Hangar Rash” to a Customer Aircraft?
• What Is Hangarkeepers Legal Liability?
• Does Aviation Liability Insurance Cover Aircraft You Operate but Don’t Own?
• How Much Aviation Liability Insurance Does an FBO or MRO Need?
• Should Your Insurer Review Hangar Leases and Service Contracts?