“Primary and noncontributory” is a requirement that appears in construction contracts, leases and service agreements. It has two parts:
- Primary: for claims involving the additional insured, your client’s policy responds first, before any other policy.
- Noncontributory: your client’s insurer won’t ask the additional insured’s own insurer to share (contribute to) the loss.
Without this wording, the “other insurance” clauses in each policy decide how two insurers split a claim, and they may end up sharing it pro rata. The contracting party (an owner or general contractor) wants to protect its own loss history and limits, so it pushes the cost onto the subcontractor’s policy.
How it shows up in an agency
A landscaping client signs a contract with a property management company that requires additional insured status on a primary and noncontributory basis, plus a waiver of subrogation. The CSR checks the GL policy for an endorsement that grants primary and noncontributory status “when required by written contract.” If it’s there, the CSR issues the certificate and notes it in the description box. If not, they ask the carrier to add it before issuing anything.
Common confusion
- The certificate doesn’t create it. Writing “primary and noncontributory” on an ACORD 25 means nothing unless the policy says so. See our ACORD 25 guide.
- Umbrellas need it too. Many contracts require the umbrella or excess policy to be primary and noncontributory to the additional insured’s own coverage. Check the umbrella form. See umbrella vs. excess.
- The contract must come first. Most endorsements apply only when a written contract signed before the loss requires it. A handshake deal doesn’t trigger them.