Terminology Tuesday – Endorsement

In every policy there is a standard coverage form, but there are also endorsements that change that form to fit each individual person’s or business’s needs.

The definition of endorsement in the Oxford English dictionary is as follows: a clause in an insurance policy detailing an exemption from or change in coverage.

As this says, there are different types of endorsements – those that add coverage, those that change coverage, or those that remove or exclude coverage.

Add

An endorsement to add coverage does just that. It either adds a higher limit to existing coverage or adds coverage that is not in the standard coverage form. For example, in a standard Business Owners Policy with Liberty Mutual, you are given a “Medical Expenses (Any One Person)” limit of $15,000, but that can be endorsed or increased to $50,000 or more.

Change

An endorsement to change coverage can replace a sentence within a standard coverage form to include coverage for something different. If this is done, the endorsement will reference the original form and say something to the extent of “This endorsement replaces section B, paragraph 2” and then will list the changed language.

Remove or Exclude

An endorsement to remove or exclude coverage does exactly that. If there is a coverage on the standard policy that the company does not want your particular policy to have, they will either remove the inclusion (if it is listed as covered on the standard form) or specifically list it as excluded (if it is unclear on the standard policy form and they want to be extra clear).

Just about anything can be endorsed onto or off a policy as long as the company allows it! If you have questions or if you want clarification on endorsements, let us know!

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