If you are planning on acquiring [or merging with] another business, changing your entity name, or changing our organizational structure you need to contact your insurance agent as soon as possible to let them know about these changes. Your insurance policies must be changed before you begin to operate under a new name or legal structure.
Your policies cover operations and activities conducted by persons or entities that are named on the first page of the policy (the “Declarations”). Sometimes, if there are a number of persons or entities to be covered by the policy, a separate endorsement will complete the Declarations with a list of additional names. If a person or entity is not named in the Declarations or such an endorsement, there is no coverage for the business operations and activities of that person or entity.
In addition, all your policies contain a “non-assignment” clause that precludes any action by you to assign a policy to another without first obtaining permission from the insurance company.
If you intend to acquire or merge with another organization, or change your company name or organizational structure, please contact your agent early in the process so your policies can be changed before you begin to operate under the new name or structure.
We also recommend that you continue to include the prior entity or name on your policy. There is always a chance a lawsuit may be filed against the prior entity, in which case it must be named on the policy so the insurance company will defend the suit.
This article was prepared and made available to your agent by the Independent Insurance Agents of Texas, which is solely responsible for its content. Please read your insurance policy. If there is any conflict between the information in this article and the actual terms and conditions of your policy, the terms and conditions of your policy will apply. The Independent Insurance Agents of Texas is a non-profit association of more than 1,500 insurance agencies in Texas, dedicated to helping its members succeed, in part by providing technical resources that explain insurance policies sold to their customers.
NOTICE: This blog and website are made available by the publisher for educational and informational purposes only and is subject to change. It is not to be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.