Chapter 9: Commercial General Liability

Question 1

2 types of Commercial General Liability (CGL) forms

Answer 1

Occurrence and Claims-Made

Question 2

Difference between two CGL forms

Answer 2

Occurrence- injury/damage occurs during the policy period regardless of when claim is reported
Claims Made- claims occurring on/after the retroactive date, made during the policy period or extended reporting period

Question 3

2 major sublines of the CGL and examples of each

Answer 3

Premises and Operations- employee carpenter drops a hammer from a rood you are replacing and injures someone walking by
Products and Completed Operations- Customer buys steamer from store. Customer gets home and uses the steamer, it malfunctions, causing steam to blow back in the customer’s face

Question 4

Under COV A- Bodily Injury/property damage, Contractual Liability is usually excluded from CGL except for 6 insured contracts (LEASE-T)

Answer 4

Lease of premises
Easement or license agreement
Agreement to indemnify a municipality
Sidetrack Agreement
Elevator maintenance agreement
Tort Liability of a third party

Question 5

COV B- Personal and Advertising Injury Liability

Answer 5

pays sums for which the insured becomes legally obligated for personal injury or advertising injury
Ex) slander, invasion of privacy, copyright infringement
*losses expressed as dollars per person/organization

Question 6

COV C- Medical Payments

Answer 6

medical expenses for bodily injury caused by an accident on the premises the named insured owns/rents/uses for accidents because of their operations
-regardless of fault or negligence
-one year from the date of the accident

Question 7

Supplementary Payments and Coverages
*which they apply

Answer 7

pays resulting expenses from the insurer’s defense of any claim/suit
1. all expenses the insurer incurs
2. up to $250 bail bonds because of accidents/traffic violation w/ use of vehicle covered
3. Premiums on bonds
4. interest on any judgement
5. other reasonable expenses
6. All costs taxed against the insured in the suit

Question 8

Who is insured under CGL

Answer 8

Named Insured
Automatic Insureds- employees
Additional Insureds- specifically named or qualify as member

Question 9

6 limits of insurance for CGL

Answer 9

1. General Aggregate (most paid for COV A&B)
2. Products & Completed Operations Aggregate (most paid COV A)
3. Personal & Advertising Injury
4. Per Occurrence Limits
5. Medical Expense Limit
6. Damage to Premise Rented to You

Question 10

Coverage territory

Answer 10

USA & Puerto Rico/Canada
worldwide for injuries/damages if goods/products are temporarily outside coverage territory and internet activities

Question 11

Employee

Answer 11

includes leased worker but not a temp worker

Question 12

Executive officer

Answer 12

person holding an officer’s position created by the insured

Question 13

Impaired property

Answer 13

tangible property but not insureds property, cannot be used b/c includes insureds product/work that is thought to be defective/dangerous/inadequate

Question 14

insured contract (LEASE-T)

Answer 14

Lease of premises
Easement or license agreement
Agreement to indemnify a municipality
Sidetrack Agreement
Elevator maintenance agreement
Tort Liability of a third party

Question 15

Loading or unloading

Answer 15

handling of property

Question 16

Mobile equipment

Answer 16

bulldozers, farm machinery, forklifts, off public roads
vehicles solely used on/next to insured premises
vehicles on crawler treads
cranes, shovels, loaders, diggers

Question 17

occurrence

Answer 17

accident including continuous or repeated exposure to substantially the same conditions

Question 18

Personal and Advertising injury

Answer 18

injury from the following…
false arrent, detention or imprisonment
malicious prosecution
wrongful eviction, entry or invasion of privacy
oral or written publications of material that slanders
use of another’s advertising ideas
Infringement of copyright

Question 19

Products and Completed operations hazard

Answer 19

bodily injury or property damage that arises out of insured’s product

Question 20

Property Damage

Answer 20

physical damage to tangible property including loss of use
loss of use to tangible property not physically injured

Question 21

Temporary worker

Answer 21

seasonal/short-term workload
substitute for a permanent employee on leave

Question 22

Volunteer worker

Answer 22

no employee of insured and donates own time (w/o payment)

Question 23

your product

Answer 23

any goods/products manufactured, sold, distributed by named insured

Question 24

Your work

Answer 24

work/operations performed by named insured or on behalf

Question 25

Trigger

Answer 25

how coverage for claim is activated

Question 26

Retroactive date

Answer 26

determines when coverage starts; in order for it to apply, the occurrence must take place after the retroactive date
*Q’s to ask for determining…when was occurrence, what is retroactive data, when was claim made
*if occurrence was before retroactive date, no coverage
*if occurrence was after retroactive date and claim was made during policy period, coverage applies

Question 27

Extended reporting periods

Answer 27

used to provide coverage for claims that reported after a claims-made policy ends

Question 28

basic extended reporting period (BERP)

Answer 28

mini tail- additional 60 days after policy termination to make any claims that occurred during policy period
Midi tail- up to 5 years after policy termination to make a claim, provided the occurrence is reported w/n 60 days of policy termination and loss occurred during policy period

Question 29

supplemental extended reporting period

Answer 29

extended the reporting period forever; purchase; requested in writing by insured w/n 60 days on policy period. Premium cannot exceed 200% of the last annual CGL premium