Chapter 2 Commercial General Liability Policy (IBC 2100) Flashcards
5 Sections of a CGL (IBC 2100)
Bodily Injury and Property Damage
Personal Injury
Medical payments
Tenants legal liability
4 sections of Insuring Agreement and Exclusions
Who is insured
Limits of insurance
Commercial general Liability conditions
Definitions
Key feature of Insuring Agreement 1
Coverage provided for bodily injury and property damage only
Bodily Injury
injury, sickness or disease sustained by a person including death resulting from any of these at any time
Sickness or disease
Conditions that originate inside the body
Death
Death from bodily injury, sickness or disease is covered at anytime under the insuring agreement
Property Damage
Physical injury to tangible property including all resulting loss or use of that property
Types of liabilities that are insured
Tort liability
Certain contractual liabilities
Statutory Liability
Insurer liable to pay
Compensatory damages only
Coverages provided for losses in
Canada and USA including QUam, Virgin Islands and Puerto Rico
Intentional bodily injury and property damage usually isn’t covered when would there be an exception
When bodily injury occurs due to a person using reasonable force to protect person(s) or property
7 exceptions to Liability assumed under contract exclusion
A lease of premises
A sidetrack agreement (railroad track installed on business land)
Easement or license agreement for pedestrian crossing, railroad EXT
Any other easement agreement
String wires and cable across land
Hang eaves of a building over another’s land
Elevator maintenance agreement
Instances when Workers Compensation will not respond for injured employees
Liability assumed under contract
Employee on whos behalf contributions are made by the insured under the provisions of any workers compensation law
Exclusions existing under IBC 2100 relating to bodily injury and property damage
Any automobile
Any motorized snow vehicle or its trailers
Any vehicle used in speed or demolition contest
Any vehicle which would be required by law to be insured by motor vehicle liability policy
Types of equipment of machinery would be included in the policy for injury and property damage that arose out of their operation
Front-end loaders
Fork lifts
Road graders
Caterpillars
Heavy construction machinery
2 instances where coverage for watercraft under IBC 2100
Watercraft is ashore on premise you own or rent
Watercraft not owned under 8 meters and not being used to carry person or property for charge
Aircraft and watercraft are very similar - key exclusion difference
Aircraft exclusions makes no provisions or exceptions
5 types of property excluded in a CGL
Property owned, rented or occupied by the insured
Premises sold, given away or abandoned of property damage arises out of those premises
Property loaned to insured
Property being restored, repaired or replaced because of work incorrectly performed
Broad Form Completed Operations Endorsement
Excludes coverage only for that particular part of the insured’s work responsible loss and not all of it
4 things insured may opt to do rather than having to be fully responsible for future suits against them and avoid cancellation of policy
Withdraw their products of work
Recall
Inspect
Repair or replace defective product or work
Removal or disposal of the defective product or work
5 coverages provided under Personal Injury Liability
False arrest, detention or imprisonment
Malicious prosecution
Wrongful entry or eviction from property
Slander or Libel of person or organization
Oral or written publication of material that violates a persons rights
False Imprisonment
Holding someone without lawful Justification against their will
False arrest
False imprisonment but with intent to turnover to the police for prosecution
2 conditions present in malicious prosecution
Complainant was arrested and later released
Evidence revealed that the person making the complaint did not have an honest belief that a crime has been commited
Who will be charged with wrongful entry or eviction
A landlord
Defamation
A statement that cause unjustified injury to the reputation of another person which results in the loss to that persons esteem, confidence and respect of the community
Slander
Spoken defamation
Libel
Written defamation
4 activities considered an advertising liability that would not be covered under this section of the policy
Advertising
Publishing
Broadcasting
Telecasting
What basis are medical payments made
Voluntarily
Immediately
3 reasons other then goodwill would be included in no fault medical payments under IBC 2100
Chances to greatly reduce injury by immediate medical attention
Potential for claims alleging negligence is reduced
Legal confrontation with the victim over expenses is avoided
5 types of expenses paid under Coverage C - Medical Payments
First Aid
Ambulance
X-rays
Medical, surgical and dental services
Funeral expenses
Who is excluded under Coverage C - Medical Payments
The insured
The insured’s employees
Any person participating in athletics
What 2 types of liability do tenants legal liability to the owner for damage to rented premises fall under
Tort Liability - legal obligation
Contractual Liability- contractual obligation
Minimum limit of coverage to be purchased for tenants legal liability exposures
Should be a minimum no less than the value of the building or portion of the building occupied by the insured
3 examples of short term rental exposures
Rental of hotel rooms
Rental of other facilities with purpose of accommodation
Seminars or tradeshows
4 perils covered under Coverage D - property damage arising out of insured’s negligence
Fire
Explosion
Smoke
Leakage of fire protective equipment
What 3 liability exclusions exist under Coverages A C & D
Pollution Liability
Nuclear Energy Liability
War Risks
4 areas policy excludes for claims of injury or damage arising out of pollutants location
On insureds premise
Any waste disposal site
While being handled, transported,stored,treated or disposed of by insured on policy
Any work site when brought onto site by the insured
4 additional claims related expenses covered as supplementary payments under Coverages A,B & D
Insurer’s cost
Cost of bonds to release attachments
Reasonable expenses incurred by the insured at the insurer’s request
All costs taxed against the insured and any interest accruing after entry of judgement
2 kinds of costs addressed under costs taxed against the insured
When is the interest on the amount calculated
Court costs
Interest on amount of judgement
Commencing from the date of judgement
Under premise and operations liability what factors determine the premium charged
Square footage
Occupancy
Payroll
Location
Premium determined under product liability
Type of product sold
Sales volume
Territory
Premium determined for completed operations liability
Type of work preformed
Gross receipts
Premium for coverage B- Personal Injury Liability Exposures
Most insurers include cost in base premium
Premium for Coverage C - Medical payments
No additional premium charged for this coverage
Premium for Coverage D - Tenants Legal Liability
Generally 35% of the building rate
Who or can be insured on the CGL Policy
Individuals
Partnerships or joint ventures
Organizations other then partnership and joint ventures
Generally all persons engaged in business would be included under CGL including -
Owners, partners, spouses and directors
Employees
A non-employee acting as the insured’s real estate manager
Those having temporary custody or control of property after death of insured
Upon death, legal representative appointed by the business
Newly formed business or acquired business would be automatically covered under existing IBC 2100
Name insured purchases all or majority interest in an existing operation or forms a new one
Coverage provided unless a separate policy exists
Automatically covers for 90 days or until expiry of policy
Aggregate Limit
Amount stated on policy which states the maximum limit policy will pay for all claims for which insurance is provided
Each Occurrence Limit
Maximum limit paid by the insurer for any one occurrence
Condition insureds in when they are unable to pay their debts when due
Insolvency
Canadian Currency Clause
Payment of claims the same currency as premium was collected
Terms regarding cancellation of IBC 2100 Policy
Request of cancellation must be under signature of first named insured
Insurers termination notice required to be sent to first name insured
Any refund of premium payable to first named insured
3 duties of insured in event of a claim or action
Promptly notify the insurer
Details of claim (time, place, circumstance)
Prompt written notice to the insurer
Immediately provide the insurer with copies of demands,notice,summons of legal papers received
Condition of examination of books and records
Allows the insurer to inspect the insureds records at any time and up to 3 years after expires policy
Under Legal Action Against Us, what time frame must a suit be filed
1 year from the time the right action arose
What happens when another policy is insuring the same exposure
Primary policy responds for coverage up to the limits unless both policies are listed as primary, share responsibility
Premium Audit
Outlines methods used by insurer to ensure it receives proper premium for the risk.
Conditions of Premium
Establishes the Liability of the insured with the insurer in respect to premiums charged and refunds provided under policy
Representation
A statement of fact made to induce another to enter contract
2 significant respects under Condition of Seperation of Insureds Cross Liability
Policy applies to each separately, breach made by one insured does not effect coverage of other insured
All exclusions applied seperately
Condition of Transfer of Rights of Recovery Against Others to US
Acknowledges the right of the insurer to subrogate against any party responsible for the loss
Condition of Transfer of Your Rights and Duties under policy
Except in cases of death of named insured, policy cannot be transferred to any other person without permission of the insurer
Product
Any goods other then real property, manufactured, sold, handled, distributed or disposed of by insured
3 sections that explain the All Exclusivity of one’s product
Products manufactured,sold,handled, distributed or disposed of by insured
Their containers, materials, parts equipment furnished with connection to product (comes with screwdriver)
Warranties made respecting fitness,quality or performance of product
Completed operations exposure
Arises out of work preformed by the business
When work is defective or causes injury, person who preformed work may be sued for damages
“work” as relates to Commercial General Liability Policy
Work actually done by the insured or on behalf of the insured
Materials parts, equipment in connection to operations and work
Any warranties regarding fitness,quality, durability or performance of work or materials used
5 factors to consider how much insurance is enough
Extent of previous awards made by courts for similar types of business
Inflation
Existence of insurance
Territory of operations
Ability of a business to absorb a loss
2 advantages of liability insurance
Provided with service of professional adjusters trained in fraudulent claims
Defense costs included
