Primary and non-contributory is one of the most important provisions in construction insurance — and one of the most frequently overlooked during COI review. Without it, a claim that should hit the sub’s policy first can bleed into yours. Here’s exactly what PNC means and how to verify your subs have it.
You’ve required Additional Insured status. Your sub submitted their COI. The certificate shows you as Additional Insured. You’re protected — right?
Not necessarily. Being listed as an Additional Insured determines that you can access the sub’s policy in a claim. Primary and non-contributory language determines which policy pays first when both you and the sub carry coverage that could respond to the same claim.
Without PNC language, the sub’s insurer can require your policy to contribute — splitting the claim between your policy and theirs. That drives up your premiums, depletes your limits, and undermines the risk transfer you thought you had.
What Primary and Non-Contributory Means
Primary means the sub’s insurance policy pays first — before any other applicable policy, including yours.
Non-contributory means the sub’s insurer cannot require your insurance to contribute to the claim, even if your policy also covers the loss.
Together, PNC language ensures that when a claim arises from a subcontractor’s operations on your project, the sub’s policy is the first-responder — and your policy is not drawn into the loss unless the sub’s coverage is insufficient.
Why PNC Matters for General Contractors
Construction GCs carry their own GL policies. On a project where a sub’s crew causes an injury to a third party, both the GC’s policy and the sub’s policy may technically apply — since the GC may be named in the claim simply by virtue of being the prime contractor.
Without PNC language in the sub’s policy:
- The sub’s insurer can invoke “other insurance” clauses and require your policy to share the loss
- Your deductible may be triggered even though the incident was entirely caused by the sub
- Your policy limits are eroded by claims you thought were covered by subcontractor insurance
- Your premiums rise at renewal based on claims activity that wasn’t your fault
- The risk transfer you intended — sub bears their own exposure — doesn’t actually happen
PNC is the contractual mechanism that enforces the risk transfer. Additional Insured status (CG 20 10) gives you access to the sub’s policy. PNC ensures that policy pays first. Both are required for real risk transfer.
What Happens Without PNC When a Claim Occurs
You required Additional Insured status and got it. You assumed the sub’s policy would pay first. Without PNC language, that assumption has no contractual basis — and the sub’s insurer will use it against you in a claim.
Billy Compliance TeamWhen a claim arises and both policies could apply, the sub’s insurer will look at the “other insurance” clause in the sub’s policy. Standard GL policies typically have language that makes coverage excess over other available insurance — meaning they’ll try to have your policy pay first unless PNC language specifically overrides that.
The result: a claim that should have been absorbed entirely by the sub’s carrier becomes a shared loss between policies. Your deductible fires. Your loss run gets a mark. Your premium at renewal reflects activity you didn’t cause.
How to Require PNC in Your Subcontracts
PNC language should appear in two places: your subcontract agreement and your insurance requirements exhibit. Here’s the standard language to include:
Standard PNC contract language
“The coverage provided by Subcontractor’s Commercial General Liability policy shall be primary and non-contributory with respect to any insurance or self-insurance maintained by [Your Company Name]. Any insurance maintained by [Your Company Name] shall be excess and non-contributory with respect to Subcontractor’s insurance.”
Beyond the contract, require that the sub’s COI and endorsement documents confirm PNC status. Many carriers include PNC language in their standard blanket Additional Insured endorsements — but some do not, and the absence isn’t always visible on the COI alone.
Build PNC into your subcontractor prequalification form as a required confirmation: “Can your policy provide Primary and Non-Contributory status? (Y/N)” — and follow up with actual endorsement documentation, not just a yes/no on a form.
How to Verify PNC on a Submitted COI
The ACORD 25 COI form has a text field in the “Description of Operations” section where brokers often note “Primary and Non-Contributory” — but this is a description, not a policy provision. Notes on the COI don’t change the policy. Only endorsements do.
To actually verify PNC:
- Request the endorsement — Ask for the specific policy language or endorsement form that provides PNC status, not just a notation on the COI.
- Review blanket AI endorsement language — Some blanket Additional Insured endorsements include PNC language. If so, confirm your written contract triggers the blanket endorsement.
- Check for standalone PNC endorsements — Some carriers issue separate endorsements confirming primary and non-contributory status. If your sub has one, confirm it covers the project and your entity specifically.
- Compare against your contract requirements — Verify that the language in the endorsement matches the PNC requirement in your subcontract, not just that the words “primary” and “non-contributory” appear somewhere in the document.
Verify PNC — and Every Other Endorsement — Automatically
Billy reviews CG 20 10, CG 20 37, Primary & Non-Contributory, and Waiver of Subrogation on every submitted document. No manual review required.
See the AI Review Assistant →Frequently Asked Questions
Is PNC the same as Additional Insured status?
No — they’re related but separate. Additional Insured status (via CG 20 10) gives you access to the sub’s policy. PNC determines that the sub’s policy pays first when both policies could apply. You need both for effective risk transfer.
What if a sub says their policy is “automatically” primary and non-contributory?
Some blanket AI endorsements include PNC language automatically. If so, verify the endorsement language confirms it and that your written contract triggers the blanket endorsement. “Automatically” is a claim — verify it with documentation.
Does PNC apply to Workers’ Compensation and Auto policies too?
PNC is primarily a GL provision. Workers’ Compensation has its own rules about which policy responds (generally the policy covering the injured employee’s employer). Commercial Auto policies have separate “other insurance” provisions. If you have concerns about specific coverage types, review with your broker.
