You have been asked for these to be added to certificates of insurance, but what exactly does it do? A waiver of subrogation prohibits your insurance company from suing your client. Normally, if a client is sued they don't remain a client for long. The insurance company will charge 3-5% to waive their right to subrogate (sue your client for damages).
The waiver does NOT however restrict your employee from suing your client. If your employee does sue your client, your insurance company can still file a lien (sue) your employee to recover some damages. Your additional insured endorsement may or may not respond to defend your client depending upon the wording of your general liability policy.
Also, the waiver does not restrict your ability to sue your client. Only your contract with a hold harmless agreement would restrict your ability to sue. So, in summary, you can pay your insurance company not to sue and promise yourself through contract as well.
Words matter; on insurance policies, certificates and contracts.
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