The CG 20 15 is an Additional Insured – Vendors endorsement often used in commercial general liability (CGL) insurance policies. It provides coverage to a vendor as an additional insured on the manufacturer's or supplier's policy. Here’s a breakdown of what it does and why it’s used:

What is the CG 20 15 Vendor Endorsement?

  • Purpose: It extends liability coverage from the manufacturer or supplier of a product to the vendor selling or distributing that product. This protects the vendor if they are named in a lawsuit arising from injuries or damages caused by the product.
  • Scope: The endorsement only covers the vendor’s liability related to the manufacturer’s product. It does not cover other liabilities specific to the vendor, such as their own negligence or separate operations.

When is it Used?

This endorsement is typically required when:

  1. Manufacturers or suppliers sell products through vendors (e.g., retailers or distributors).
  2. Vendors request to be added as additional insureds to reduce their own liability exposure related to selling those products.

Example:

  • A manufacturer produces kitchen appliances and sells them through a retail store. If a customer is injured by a defective appliance and sues both the manufacturer and the retailer, the CG 20 15 endorsement provides the retailer with coverage under the manufacturer’s policy.

Key Features and Limitations

  1. Covers Product Liability Claims

    • The vendor is protected if the product causes harm due to manufacturing defects, design flaws, or inadequate warnings.

  2. Exclusions

    • Coverage does not apply if the vendor alters the product, provides improper storage, or fails to follow the manufacturer's instructions for display or use.
    • The endorsement only applies to liability arising from the specific products listed in the policy.

  3. Vendor Responsibilities

    • Vendors are expected to comply with certain conditions, such as properly labeling and storing products and not altering them in a way that affects safety.

  4. Limits of Coverage

    • The vendor’s coverage under the CG 20 15 is subject to the same limits as the manufacturer’s CGL policy.

Why is the CG 20 15 Important?

Vendors often require this endorsement to reduce their risk when selling products they don’t manufacture. For manufacturers, it helps secure partnerships with vendors while ensuring liability protection flows down the distribution chain.