When reviewing a Certificate of Insurance (COI), one line can determine who holds real liability if things go wrong on your job site or property. That line? It doesn’t always say what you think it does.

“Additional Insured” and “Additional Interest” may sound similar, but they carry very different meanings — and misinterpreting them could expose your organization to serious financial and legal risk.

In this guide, we’ll unpack:

  • What each term means
  • How they appear in insurance documents
  • Why the distinction matters in property and construction workflows
  • How to ensure your compliance workflows capture the difference

What Is an Additional Insured?

An Additional Insured (AI) is a person or organization added to another party’s insurance policy to receive legal and financial protection — most often in commercial liability scenarios.

This designation is common in:

  • Property management
  • Construction
  • Facilities operations

Typically, property owners, GCs, or asset managers require their vendors and subcontractors to carry liability insurance and extend coverage to themselves.

How It Works

If a vendor causes damage or injury:

  • The Additional Insured (e.g., property owner or GC) can file a claim directly on the vendor’s policy.
  • They are active beneficiaries of the insurance coverage — not just observers.

Why This Matters

Being named as an Additional Insured is contract-enforced risk transfer.

Without it:

  • Legal claims or financial fallout may fall on your organization
  • You may have to pay damages out of pocket

With it:

  • The vendor’s insurer has a duty to defend and indemnify you
  • Potential savings in legal fees and judgments can reach millions

What Makes It Enforceable

A COI alone isn’t enough — the endorsement is what matters.

Best practice checklist:

  1. Contract requires Additional Insured status
  2. COI references it
  3. Endorsement proves it

When all three align, your compliance foundation is strong.

Key Benefits

  • Legal protection under someone else’s policy
  • Direct rights to make claims
  • Formalized and enforceable risk transfer

Bottom line: If your name isn’t on the endorsement, you may be on the hook when things go wrong.

What Is an Additional Interest?

An Additional Interest is a third party with a financial or business interest in a policy’s status. They are notified if a policy is canceled or changed — but they have no rights under the policy.

Common examples:

  • Mortgage lender on a homeowner’s policy
  • Leasing company on an auto policy

In commercial insurance, Additional Interest does not meet contractual insurance requirements.

Why It Creates False Confidence

  • Looks official on a COI
  • Sounds protective, but it isn’t

If a vendor lists your firm as an Additional Interest:

  • You receive no liability protection
  • You cannot access defense or indemnification
  • You remain exposed if something goes wrong

Analogy: It’s like being CC’d on a security system alert without having a key. You’re aware — but unprotected.

The COI Trap

On an ACORD 25 form, Additional Interest is often listed in the:

  • “Description of Operations” box
  • “Certificate Holder” box

Many compliance teams mistakenly assume compliance is met. Without the endorsement for Additional Insured status, risk transfer is incomplete.

Key Differences Between Additional Insured and Additional Interest

The distinction isn’t just technical — it’s the difference between real protection and polite notification.

Feature Additional Insured Additional Interest
Coverage Yes — for claims arising out of the named insured’s work/operations No — receives no protection
Can file claims Yes No
Notified of policy changes Yes (if listed on COI or endorsement) Yes (primary benefit)
Liability protection Yes No
Common in commercial policies Yes Occasionally; more common in personal lines

Summary:

  • Additional Insured: protected, can claim, enforceable
  • Additional Interest: notified only, no protection

Where This Goes Wrong in Real Estate and Construction

For teams managing hundreds or thousands of COIs, this subtle difference can become a high-stakes blind spot.

Example 1: False Sense of Security

A property manager requires vendors to list the ownership entity as an Additional Insured. Vendor uploads a COI listing only Additional Interest. Incident occurs — owner assumed protected, but they’re not.

Example 2: Audit Red Flag

During a portfolio-wide audit, dozens of vendors incorrectly list the property manager as Additional Interest. Broker flags noncompliance, triggering legal review and potential exposure.

Insight: Even sophisticated teams miss the distinction when COIs are scanned visually rather than verified against endorsements.

How to Ensure Vendors List the Right Status

  1. Set clear contract language requiring Additional Insured status
  2. Request copies of endorsements (proof beyond the ACORD 25 form)
  3. Avoid relying solely on COIs as evidence of coverage
  4. Use software to verify endorsements, flag Additional Interest vs. Additional Insured, and enforce correct naming conventions

Tools like Jones don’t just store COIs — they verify endorsements, track policy exclusions, and enforce compliance at scale.

Why It Matters for Risk Management

Property managers, general contractors, and asset managers are under increasing pressure to reduce risk.

Requiring Additional Insured status ensures:

  • True coverage from responsible parties
  • Avoidance of costly legal exposure
  • Compliance with contract requirements

Real compliance in 2025:

  • Go beyond the ACORD 25 form
  • Verify policy language
  • Automate insurance workflows

Final Thought: It’s Not Just Semantics

Remember:

  • Additional Interest: gets notifications
  • Additional Insured: gets protection

The difference can cost you — or protect you. Proper verification of COIs and endorsements is essential.