Rplu Exam 2: Commercial General Liability Insurance

Front 1

Indemnity

Back 1

Insurer pays for damages or injury for which the insured is held legally liable

Front 2

Defense

Back 2

Insurer provides a legal defense against claims of liability

Front 3

1st Standard Policy General Liability form

Back 3

First issued in 1940. It was a major step toward consistency, but was still very complex.

Front 4

Comprehensive General Liability (CGL) Form

Back 4

Written in 1966. It was written in simplified language and provided a policy document specific to the insured.

Front 5

Broad Form Commercial General Liability (BFCGL) Endorsement

Back 5

In 1976, the most common endorsements were compiled into one single standard endorsement.

Front 6

Commercial General Liability (CGL) form

Back 6

Written in 1986, and is still the form used in writing insurance in the business market. Caused by a liability insurance crisis (increased number of medical malpractice lawsuits, asbestos claims, liability for environmental damage at pollution sites, etc). It allowed CGL insurance to be written on either an occurrence or claims-made basis

Front 7

Two Primary Types of Coverage Triggers

Back 7

Occurrence coverage triggers and Claims-made coverage triggers

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Claims-Made Coverage Trigger

Back 8

Coverage trigger that most PLI is written on

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Occurrence Coverage Trigger

Back 9

Coverage trigger that is triggered by an incident/ occurrence, which happens during the policy period. Most excess CGL Polices are written based on this trigger

Front 10

Extended Reporting Period

Back 10

Also called tail coverage, this provides protection for claims filed after a claims-made policy has expired

Front 11

Retroactive Date

Back 11

A date placed on policies to establish a timeframe for covering only the claims arising from incidents that happen after a specified date

Front 12

Exclusion of Specific Accidents, Products, Work, or Location Endorsement

Back 12

This allows the insurer to remove certain exposures that may be prohibitive to insure and enables the insured to obtain coverage for the non-excluded exposures. Commonly called the laser endorsement.

Front 13

Four Major Trigger Theories

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Exposure, Manifestation Theory, Injury/ Damage-In-Face, and Triple Trigger or Continuous

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Exposure

Back 14

Coverage is triggered by the first exposure to harmful conditions. Injury or damage is presumed to begin as soon as exposure occurs.

Front 15

Manifestation Theory

Back 15

Coverage is triggered when the insured first becomes aware of the injury or damage. In the case of bodily injury, coverage is triggered when the condition first manifests itself or becomes diagnosable.

Front 16

Injury/damage-in-fact

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Coverage is triggered by the date that the injury or damage actually occurs regardless of the length of exposure or whether the condition has become evident. Liability is only allocated to policies in effect at the time of actual injury or damage.

Front 17

Triple Trigger or Continuous

Back 17

Coverage is triggered by the initial exposure, by continuing exposure, and by the manifestation or diagnosis of injury or damage.

Front 18

A complete CGL Policy consists of these parts:

Back 18

Declarations, Coverage Form (occurrence or claims-made), Endorsements/amendments/ additional exclusions, Broad form nuclear exclusion

Front 19

Section I of the Coverage Form

Back 19

Insuring agreements for coverage A,B,C. Supplementary Payments

Front 20

Section II of the Coverage Form

Back 20

Who Is an Insured?

Front 21

Section III of the Coverage Form

Back 21

Limits of Insurance

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Section IV of the Coverage Form

Back 22

CGL Conditions

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Section V of the Coverage Form

Back 23

Definitions

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Coverage A

Back 24

Bodily Injury and Property Damage

Front 25

Coverage B

Back 25

Personal and Advertising Injury

Front 26

Coverage C

Back 26

Medical Payments

Front 27

Endorsement

Back 27

Written form attached to a policy that is used to change coverage provisions, terms, or conditions.

Front 28

Amendment

Back 28

Written document that revises the policy's provisions, often to add to or correct part of the policy

Front 29

Exclusion

Back 29

Provision that describes exceptions to coverage

Front 30

Supplementary Payments

Back 30

Additional payments made by an insurer for various costs and expenses associated with Coverages A and B

Front 31

Coverage Form

Back 31

Heart of the CGL Policy, which includes coverage insuring agreements, definitions, limits, and exclusions that define policy coverage

Front 32

Personal/ Advertising Injury

Back 32

Coverage B of the CGL occurrence form

Front 33

Occurrence or Claims-Made

Back 33

Types of coverage forms available for CGL insurance

Front 34

Insuring Agreement

Back 34

Part of the CGL coverage form that describes Coverages A, B, and C

Front 35

Policy Conditions

Back 35

Sections IV of a CGL Policy. Describes the insurer's and insured's rights, duties, and responsibilities.

Front 36

Who Is An Insured

Back 36

Section II of a CGL coverage form that identifies who is covered under the policy

Front 37

CGL policy components

Back 37

Declarations page, coverage form, endorsements, amendments, additional exclusions, and broad form nuclear exclusion

Front 38

Medical Payments

Back 38

Coverage C of the CGL coverage form

Front 39

Endorsements, Amendments, Additional Exclusions

Back 39

Methods of adding, excluding, or modifying policy coverage or terms

Front 40

Defense Costs

Back 40

Typically provided as supplemental payments, above and beyond, or outside policy limits

Front 41

Four Corners of the Complaint Test

Back 41

A test to determine duty to defend. This test is based on the information provided in the complaint or claim. Under this test, the courts do not look beyond the surface or face of the complaint.

Front 42

Extrinsic Facts Test

Back 42

A test to determine duty to defend. In addition to the complaint, the courts examine the policy and all facts known to the insurer from any source.

Front 43

Reservation of Rights

Back 43

An insurer agrees to defend a claim, but reserves the right to affirm or deny coverage until a later date.

Front 44

Hold Harmless Agreement

Back 44

Agreement in which one party assumes the liability for another, and, therefore agrees to provide a defense and pay for any damages

Front 45

Outside the Limits

Back 45

The limit does not apply to the defense costs and defense costs are paid in addition to the limit. This is common with CGL policies.

Front 46

Inside the Limits

Back 46

The limit does apply to defense costs and they are paid within the limit of liability. This is common with PLI policies.

Front 47

Coverage for Newly Acquired Organizations

Back 47

Coverage that is meant to be temporary and is provided for a maximum of 90 days or until the end of the policy period, whichever occurs first.

Front 48

Six limits in the 2007 CGL Coverage Form that pertain to particular types of coverage

Back 48

General Aggregate, Products-Completed Operations, Personal and Advertising Injury, Each Occurrence, Medical Expense, Damage to Premises Rented to You

Front 49

Common Policy Conditions

Back 49

Cancellation, Changes, Examination of Insured's Books and Records, Inspections and Surveys, Premiums, Subrogation

Front 50

Standard Endorsements

Back 50

Deductibles, additional coverage, additional insureds, exclusionary, certain types of risks, coverage amendments, amendment of limits, claims-made endorsements, miscellaneous endorsements

Front 51

Stand-Alone Policy

Back 51

Excess policy that follows its own terms, conditions, and exclusions as written by the insurer

Front 52

Follow Form Policy

Back 52

Excess policy that follows the terms, conditions, and exclusions of the underlying coverage.

Front 53

Combination Policy

Back 53

Excess policy that contains both stand-alone and follow form policy provisions

Front 54

Notice of Circumstance

Back 54

Provision that allows an insured to lock in coverage under the current claims-made policy for a claim made after the policy expires by providing notice of the circumstances that could potentially lead to a future claim

Front 55

Umbrella Insurance

Back 55

Type of excess insurance that provides higher limits and broader coverage over several underlying policies

Front 56

Purpose of Excess & Umbrella Insurance

Back 56

Provides higher limits of insurance in the event a claim exceeds the limits of underlying policies

Front 57

Excess Insurance

Back 57

Traditionally, a type of insurance that provides higher limits of insurance over one specific policy

Front 58

Written Notice

Back 58

Requirement to trigger coverage under a claims-made excess policy

Front 59

Retained Amount

Back 59

The amount that must be satisfied before the Umbrella Policy pays

Front 60

Concurrency Period

Back 60

Umbrella Policy provision that requires an underlying policy's aggregate limit to be exhausted during the umbrella's policy period

Front 61

Coverages provided under a standard commercial Excess or Umbrella Policy

Back 61

Bodily injury, property damage, and personal and advertising injury