An additional insured is a person, business, or entity that is added to your liability coverage because you have a business relationship with them and which may have liability due to your actions as a result of that relationship. By adding them to the general liability insurance, you extend coverage to them in the event a claim is brought against them as a result of work or services you performed for them.
This is often required by a client, event manager, property owner, or bank. They may ask you to add them to your liability coverage as an additional insured to protect them if a they are brought into a claim or suit as a result of their relationship to you.