CG 24 04 – An endorsement that waives an insurer’s recovery rights against certain parties when required by contract.
In plain language: cg 2404 is an endorsement used on liability policies when a business agrees not to let its insurer seek repayment from another party after a covered loss. Think of it like agreeing in advance that, if the insurer pays a claim, it will not “go back after” the party named in the contract for that same payment.
Technical definition: The endorsement commonly referred to as cg 2404 is the ISO Waiver of Transfer of Rights of Recovery Against Others to Us endorsement used with commercial liability policies. It modifies the Conditions section, specifically the insurer’s transfer of rights condition, and is most often attached to a commercial general liability policy when a contract requires a waiver in favor of an owner, landlord, customer, or other upstream party. Agencies often discuss cg 24 04 in connection with contractual risk allocation, certificates, and additional insured requests. This often varies by state and carrier; always check the specific policy form.
A contractor finishes a job, a customer is hurt, and the insurer pays the claim. Months later, the client learns its contract said the carrier had to waive recovery rights against the owner, but the policy was never endorsed correctly. That kind of mismatch can create coverage disputes, contract problems, and avoidable E&O exposure for insurance professionals.
A lot of people casually call this a waiver of subrogation, but in agency work the details matter. The exact endorsement, who must be waived, and whether the waiver applies only to ongoing operations or also later losses can change the outcome.
TL;DR
- CG 2404 is the ISO endorsement that changes the policy’s transfer of rights condition so the carrier waives certain recovery rights.
- It matters in agency workflows because it is often required by written contract, especially in construction, tenancy, and vendor relationships.
- A common misunderstanding is assuming a certificate alone proves the waiver exists, even if the endorsement was never issued.
- Best practice: confirm the actual endorsement wording, named parties, and timing requirements before issuing evidence of coverage.
What Is CG 24 04 in Insurance?
In practical agency terms, cg 2404 is the endorsement many clients need when a contract requires a waiver of subrogation in favor of another party. The endorsement changes the condition commonly known as transfer of rights of recovery against others to us, which is the policy provision allowing the insurer to pursue a responsible party after paying a claim. By adding the endorsement, the insurer agrees not to exercise that right against the party identified or described in the endorsement, subject to the form’s wording.
You will usually see cg 2404 attached to commercial general liability coverage, often because a landlord, customer, municipality, or project owner requires it before work starts. It is commonly discussed alongside additional insured coverage, primary and noncontributory wording, and indemnity clauses because all of those pieces are part of the same risk transfer structure. In some accounts, the waiver applies only when required by written contract; in others, it may be scheduled for specific required parties.
Agencies should also understand that cg2404 does not create coverage for a loss that is otherwise excluded, and it does not replace careful review of coverage part details. It simply changes the carrier’s recovery rights after payment of covered claims. That is why certificate review matters: the certificate may reference a waiver, but the endorsement itself controls. Some carriers use proprietary forms instead of the ISO cgl form, so the exact effect can differ. This often varies by state and carrier; always check the specific policy form.
Key Related Terms to Know
- Subrogation – The insurer’s right to recover from the person or business that caused the loss after the insurer pays the insured. In everyday agency conversations, clients often use this term when they really mean the endorsement that waives that right.
- Transfer of rights of recovery – The policy condition that lets the carrier step into the insured’s shoes and pursue recovery from a liable party. cg 2404 modifies that condition for certain third parties when the contract requires it.
- Additional insured – A person or organization added to a policy for some protection under the insured’s liability coverage. This is different from a waiver because additional insured status gives certain coverage rights, while a waiver affects recovery rights after payment.
- Primary and noncontributory – Contract wording that addresses whose policy pays first and whether one insurer can seek contribution from another. It is often requested together with a waiver, but it serves a different purpose than a waiver of rights.
- Scheduled waiver – A version where the party to be waived is specifically listed, often by name. This can create issues if the contract party changes, the list is incomplete, or the endorsement does not match the current written contract.
- Blanket waiver – A broader approach often triggered when the insured has agreed in a written contract to provide the waiver. Many clients ask for blanket waiver of subrogation because it can be more efficient than endorsing each job one by one.
- Contract review – The process of comparing insurance requirements in lease agreements, service agreements, or construction contracts to what is actually on the policy. For agents and brokers, this is one of the most common places where misunderstanding can lead to unnecessary exposures.
Common Questions About CG 24 04
Is cg 2404 the same thing as a waiver of subrogation?
Usually, that is how clients describe it, but the better technical description is waiver of transfer of rights of recovery. In practice, many people use waiver of subrogation and cg 2404 to mean the same request on a liability policy. The E&O issue is that casual language can hide important details, such as whether the request applies to one party, all contracts, or only to ongoing operations. When documenting the file, tie the request to the exact endorsement or carrier form rather than relying only on verbal shorthand.
Does a certificate prove the waiver exists?
No. A certificate can show that the agency believes the coverage is in place, but it does not change the policy. If a customer requests a waiver of subrogation form, the safest workflow is to verify the endorsement is actually attached, note the policy number, and confirm whether the request is blanket or scheduled. If the contract has an expiration date tied to the project or lease term, document that too so the file reflects what was confirmed at claim time.
When do clients usually need this endorsement?
The most common requests come from construction, tenancy, and vendor contracts. A general contractor may require subcontractors require the waiver in favor of upstream parties, while a property owner may require it in a lease or maintenance agreement. It also appears in service agreements where the parties want to reduce later legal action between business partners after a covered loss. Good workflows compare contract insurance requirements with endorsements before work begins.
Does cg2404 apply to every kind of claim?
No. The endorsement does not expand coverage beyond the cgl policy or override exclusions, specific limitations, or policy terms and limits. It generally affects recovery against others only after the insurer pays a covered loss involving injury or damage. If the claim is excluded, outside the coverage part, or not triggered under the policy, there may be nothing to waive. That is why agencies should avoid describing it as a guarantee of payment or defense and indemnity.
Is this the same as adding someone as an additional insured?
No, and this is a frequent point of confusion. A waiver changes the insurer’s right of recovery; additional insured coverage may provide direct coverage to another party for certain liability arising out of the insured’s work. Some contracts require both, and missing one can create legal complications or disputes over defense costs. For insurance professionals, the key is to confirm whether the contract demands coverage, a waiver, or both.
Do clients need a separate form for every job or customer?
Not always. Some carriers offer a blanket approach, while others use scheduled endorsements for named parties. If the carrier uses blanket language tied to written contracts, the agency should still verify that the contract exists, that the insured agreed before the loss, and that the required parties fit the endorsement wording. A sloppy assumption here can create financial risks for the client and E&O problems for the agency.
CG 24 04 vs. Additional Insured Endorsement
CG 2404 is often requested together with an additional insured endorsement, but they solve different problems. One affects the insurer’s ability to pursue reimbursement after a covered payment; the other may grant direct liability protection to another entity under the policy. That distinction matters when reviewing complex contractual requirements.
|
Comparison Area |
cg 2404 |
Additional Insured Endorsement
|
|
Primary use case |
Waives the insurer’s recovery rights against certain parties when required by contract |
Extends certain liability protection to another person or organization |
|
Coverage / concept type |
Condition modification tied to recovery rights |
Coverage grant change for additional insured entities |
|
Typical exclusions |
Does not override exclusions, restrictive language, or uncovered losses |
Subject to endorsement wording, scope, and the policy’s exclusions |
|
Who is most affected by errors |
Named insured, required parties, and agencies handling certificate review |
Named insured, additional insureds, and parties relying on direct coverage |
|
Common mistakes |
Assuming a certificate alone creates the waiver; confusing waiver of subrogation vs waiver of transfer |
Assuming additional insured status automatically includes all contracts, all operations, or completed operations coverage |
In workflow terms, agencies should confirm whether the contract requests additional insured coverage, a waiver of subrogation endorsement, or both. They also need to watch for related requirements such as primary and noncontributory wording, ongoing operations coverage, and completion of operations. A client may satisfy one requirement and still breach the contract by missing another. This often varies by state and carrier; always check the specific policy form.
Real Claim Examples Involving CG 24 04
Scenario 1: A drywall subcontractor signed a written contract requiring cg 2404 in favor of the site owner and the general contractor. During ongoing operations, dust control barriers failed and a visitor alleged bodily injury from exposure and a fall near the work area. The carrier handled the covered claim under the insured’s commercial general liability policy. Because the waiver had been endorsed as required, the insurer did not pursue the upstream party afterward, even though negligence contributed to the event in a way that might otherwise have supported recovery. The lesson: when the contract requires a waiver before work begins, the endorsement should be confirmed early and documented in the file.
Scenario 2: A janitorial company entered into lease agreements and customer service agreements for office cleaning. The client told the agency it needed “the usual waiver,” and a certificate was issued, but no waiver of subrogation form was actually attached. Months later, water from cleaning equipment damaged tenant property, and the insurer paid for covered claims. The landlord argued the contract required a waiver and alleged the business had breached its insurance obligations. Even though the insurer adjusted the loss, the missing endorsement created uninsured losses tied to the contract dispute. The lesson: a certificate is not a waiver of subrogation form cg2404, and documentation should match the policy.
Scenario 3: A mechanical contractor had a blanket setup for some customers but not all. A new customer’s written contract required a waiver in favor of project owners for both ongoing operations and completed operations exposure. After project completion, an equipment failure led to property damage and an injured party claim. The agency had confirmed additional insured coverage but had not closely reviewed whether the waiver wording extended beyond the active project phase. The result was a dispute over whether the carrier retained recovery rights against certain third parties after payment. The lesson: review the exact waiver of subrogation form, timing triggers, and contract language rather than assuming all risk transfer requirements line up.
Limitations and Common Mistakes
- CG 2404 does not create liability coverage where none exists under the commercial general liability form, and it does not erase exclusions in the cgl form or other coverage parts.
- A waiver of subrogation should not be treated as proof that another party has direct coverage; that is a separate question from additional insured coverage.
- Agencies create E&O exposure when they issue evidence before confirming the endorsement, the named insured, the schedule or declarations, and the underlying written contract.
- Watch for missing details on a waiver of subrogation template, such as the person responsible, contract date, or whether the request is limited to ongoing operations.
- Some requests involve specific limitations, required parties, or a wos endorsement on a non-ISO form. Do not assume every carrier version works the same way.
- Poor communication about premium impacts, claim time expectations, or whether the contract applies to third parties can damage business relationships and create contractual risk.
How to Explain CG 24 04 to Clients
Small business owner: “This endorsement is usually requested when your contract says your insurer has to give up its right to go after the other party after paying a covered claim. It does not broaden your coverage, but it can help you meet contractual obligations and preserve business relationships. We should compare the contract to the policy so we know exactly who must be waived.”
Contractor or project manager: “If a job contract asks for cg 24 04 12 19 or similar wording, the goal is usually to stop the carrier from seeking repayment from certain project owners or other upstream parties after a covered loss. That request often comes with primary and noncontributory wording and additional insured status, but those are separate items. We will review the written contract and confirm whether the carrier uses blanket or scheduled wording.”
CFO or risk manager: “This is one piece of your broader risk management strategies. The endorsement can support your risk transfer requirements, but it should be reviewed together with indemnity wording, additional insured coverage, and any contract language about completed operations. Because forms differ, we recommend confirming the actual waiver of subrogation form, involved parties, and any carrier conditions before relying on it.”
When clients ask for a waiver of subrogation form or even a waiver of subrogation template, it helps to explain that the policy endorsement controls, not a stand-alone certificate attachment. If legal counsel is reviewing contract language, the agency can coordinate on insurance wording without giving legal advice. That helps reduce legal liability, avoid legal complications, and keep the client from relying on invalidating watermarks or informal samples. For agents and brokers, the best practice is simple: document the request, review the contract, confirm the endorsement, and explain any gaps before the job starts.