Chapter 9 Commercial General Liability Coverage
Which of the following is considered an insured's product? A Goods shipped to a retailer to be sold B Merchandise held by the insured as inventory C Goods sold by the insured at a trade show D Remodeled building
Goods sold by the insured at a trade show
Which of the following is covered by Medical Payments under the CGL? A Bodily injury to an insured that is injured while playing tennis B Bodily injury to a person hired to do work for the insured C Bodily injury to a person on a part of the premises that the insured owns or rents and that the person normally occupies D Bodily injury to an insured's customer while shopping on the insured's business premises
Bodily injury to an insured's customer while shopping on the insured's business premises
Which of the following is not a peril covered by personal injury? A Wrongful eviction B Malicious prosecution C Breach of contract D Libel
Breach of contract
___________ is not covered by the CGL Coverage B - Personal and Advertising Injury
Breach of contract
Which of the following legal liability exposures is covered if bodily injury or property damage is caused by the insured's negligent or faulty work? A Completed operations B Contingent liability C Premises and Operations D Products
Completed Operations
Which of the following is true regarding the Products exposure of the CGL? A Products liability Coverage includes Liquor Liability and Dram Shop Liability insurance B Coverage commences immediately upon sale of the product even before the purchaser leaves the insured's premises C Products Liability Coverage commences immediately upon sale of the product even before the purchaser leaves the insured's premises D Coverage applies to the bodily injury (BI) and property damage (PD) the product causes but not to the product itself
Coverage applies to the bodily injury (BI) and property damage (PD) the product causes but not to the product itself
Under the CGL, which of the following would exclude from coverage the legal liability associated with a product?
Expected or intended injury
Which of the following is NOT an exclusion in the CGL policy? A Host Liquor Liability for those with incidental exposure B Impaired Products C Insured's Work D Insured's Product
Host Liquor Liability for those with incidental exposure
Each of the following provides buy back coverage for the insured, except: A Modified pollution extension endorsement B Pollution liability coverage for designated sites C Pollution extension endorsement D Limited pollution liability coverage
Modified pollution extension endorsement
An insured who goes to client's offices and homes for appointments would need coverage for which liability exposure?
Premises and Operations
Which of the following legal liability exposures is covered if the employee of a business causes bodily injury to another person while working at the insured's business location?
Premises and Operations
ABC Industries contracts with municipal governments to build bridges, viaducts, and similar engineering projects. If workers from ABC Industries cause damage to a taxicab while pouring the foundation for a new overpass, which kind of liability exposure would this be an example of?
Premises and operations
Which of the following is not a contingent liability exposure? A Contractual liability exposure B Liability exposure of insured's sub-contractors C Owners and Contractors Protective liability exposure D Premises liability exposure
Premises liability exposure
All of the following are true of the Occurrence Form, except: A As long as the injury or damage occurred during the policy period, the claim date is immaterial B Supplementary payments are automatically included C For coverage to apply, the injury or damage must occur during the policy period D The length of the retroactive date will depend upon the insurer
The length of the retroactive date will depend upon the insurer
Which statement is correct regarding the Supplemental Extended Reporting Period?
The premium is a one-time charge and fully earned at issuance
A CGL policy with a general aggregate limit of $300,000 and a per-occurrence limit of $100,000 would have how much remaining after paying a claim for a $200,000 loss, and subsequently a second claim for a $100,000 loss?
$100,000
An insured's CGL has a Products and Completed Operations Aggregate Limit of $100,000 with a $20,000 limit per occurrence. Following claims for two separate occurrences in the amounts of $35,000 and $25,000, how much of the aggregate remains for all other claims in the policy period?
$60,000
Under a CGL, at what point in time is the earned premium determined by the premium audit?
At the end of the policy period
Which type of reporting period is provided automatically under the CGL written on a claims-made basis?
Basic Extended Reporting Period
Which of the following is not covered under the Limited Pollution Liability coverage and Pollution Extension endorsement? A Escape of pollutants B Clean up costs C Threatened discharge of pollutants D Waste disposal leaks
Clean up costs
Which statement is false regarding the completed operations exposure?
Coverage includes replacement of the work that caused the loss
Which of the following is not considered a type of advertising injury? A Extortion B Infringement of copyright C Misappropriation of advertising ideas D Violation of copyright
Extortion
The most the insurer will pay during the policy period for medical expenses under Coverages A, B, and C is which of the following limits of liability?
General Aggregate Limit
Who is not an insured under the Commercial General Liability policy?
Members of a past partnership not listed in the Declarations
A chemical manufacturer requires protection for pollution liability and clean up costs. Which of the following pollution liability coverages should the business purchase? A Limited Pollution Extension Endorsement B Limited Pollution Liability Coverage Form C Pollution Extension Endorsement D Pollution Liability Coverage Form
Pollution Liability Coverage Form
What is the difference between the Commercial General Liability Occurrence and Claims-Made forms?
The coverage trigger point
Basic Extended Reporting Period (BERP)
This extended reporting period is a provision in a claims-made form and allows claims to be reported after the policy term for a specific period of time, such as 60 days after the policy's expiration or cancellation date
Product liability would cover
A restaurant customer who contracts food poisoning
Insuring Agreement
The insurer will pay those sums the insured becomes legally obligated to pay as damages because of bodily injury and/or property damage to which coverage applies, provided the occurrence took place during the policy period and in the coverage territory.
Medical payments coverage under the Commercial General Liability Coverage Forms includes reasonable medical expenses if they are incurred and reported within how many years following an accident?
1
Choose the false statement about the CGL policy. A Changes to a CGL policy may be made only by endorsement issued by the insurer B A Products and Completed Operations Liability claim will reduce the General Aggregate Limit C The General Aggregate Limit will be reduced by a medical payment D A bodily injury claim must be caused by an occurrence and it must have taken place in covered territory
A Products and Completed Operations Liability claim will reduce the General Aggregate Limit
Which injury would be covered by a CGL policy?
A customer injured while standing in an area marked 'For Employees Only'
All of the following are insured under the CGL, except: A A stockholder B A partner C A person participating in an athletic event D A volunteer worker acting on behalf of the insured
A person participating in an athletic event
Which of the following would not be considered an insured under a CGL? A An LLC employee's spouse assisting in cleaning the office so they can leave for vacation more quickly B Real Estate Manager acting on behalf of the insured C Volunteer worker D Executor of the CEO's estate after his death
An LLC employee's spouse assisting in cleaning the office so they can leave for vacation more quickly
Which of the following would not be covered under Coverage A of the CGL? A An insured was visiting a client in Canada, who was injured after he tripped over the insured's briefcase B An insured's client was injured when she slipped on a loose rug on the insured's premises C An insured's employee is injured when a bookcase in the office falls on her D While working at a trade show, an insured's employee started a small fire
An insured's employee is injured when a bookcase in the office falls on her
Which of the following is excluded under both the Limited Pollution Liability coverage form and Pollution Extension endorsement? A Escape of pollutants B Threatened discharge of pollutants C Clean up costs D Waste disposal leaks
Clean up costs
ABC Industries contracts with municipal governments to build bridges, viaducts, and similar engineering projects. If a bridge completed in the prior year by ABC Industries were to collapse, which kind of liability exposure would this be an example of?
Completed operations
Which of the following legal liability exposures is covered if a business employs an independent contractor? A Contingent liability B Completed operations C Products D Premises and Operations
Contingent Liability
What type of insurance indemnifies the legal liability of an insured for the actions of the insured's subcontractors?
Contingent Liability Insurance
Which of the following insurance forms is designed for the person who has the potential for a liability exposure caused by negligent acts of the contractor or subcontractor he hires to make repairs, construction, or alterations?
Contingent Liability Insurance
All of the following are true of medical payments under the Commercial General Liability Coverage Forms, except: A Coverage applies to the insured's injuries B Coverage applies to expenses that are incurred and reported to the insurer within 1 year of the accident C Coverage applies to injuries that occur because of the insured's operations D Coverage applies to injuries that occur on the premises that the insured owns or rents
Coverage applies to the insured's injuries
Choose the false statement about the CGL policy. A The insurer may examine the insured's books anytime during the policy period, or within 3 years after the policy ends B The insurer's written consent is required for any transfer of rights and duties to another person C Contingent Liability Policies are also called Owners and Contractors Protective Liability D Coverage is automatically provided for watercraft liability
Coverage is automatically provided for watercraft liability
Why is bodily injury to an employee excluded in Commercial General Liability Insurance?
Coverage is provided under Workers' Compensation
All of the following about the CGL's products liability coverage are correct, except: A Coverage applies to bodily injury the product causes B Damage to the product itself is covered C Coverage applies to bodily injury occurring away from premises the insured owns or rents D Coverage applies to property damage the product causes
Damage to the product itself is covered
In commercial liability policies, the word 'tail' is synonymous with
Extended reporting period
Which of the following is not considered a product liability exposure? A Product distributed to customers B Goods manufactured and sold to customers C Goods stored on the insured premises D Product consumed by a person at a restaurant
Goods stored on the insured premises
Which of the following is not a provision found in Section IV of the CGL? A Premium audit B Bankruptcy C Inspection and surveys D Other insurance
Inspection and surveys
Which form provides coverage for a loss that takes place during the policy period and is not required to be reported within a certain time frame?
Occurrence Form
Which of the following would not be excluded under Coverage A of the CGL? A Operation of mobile equipment B Damage to insured's work C Discrimination D Product recall
Operation of mobile equipment
All of the following are considered liability assumed under insured contracts, except: A Elevator maintenance agreements B Ordinance or Law C Sidetrack agreements D A lease of premises
Ordinance or Law
An insured contract includes all of the following, except: A Pollution liability B A lease of premises C A side track agreement D An elevator maintenance agreement
Pollution liability
Damages from which of the following would apply to the per occurrence limit under a Commercial General Liability policy? A Libel and slander B Professional malpractice C False arrest D Invasion of privacy
Professional malpractice
The Condition that states that the insurance applies separately to each insured is called
Severability
Which of the following would be an insured under the CGL policy? A Spouse of an LLC member B Spouse of volunteer worker C Trustee's spouse D Spouse of a partner
Spouse of a partner
Which of the following statements is incorrect about Supplementary Payments under the CGL? A Supplementary payments apply to losses under all Section I coverages B The cost of bail bonds is included up to $250 C The insurer's claim-related expenses are included D Payments do not reduce the Limit of Liability
Supplementary payments apply to losses under all Section I coverages
Which of the following statements regarding Supplementary Payments under the CGL is false? A Insurer claim related expenses are included B Supplementary payments will reduce the limits of the policy C Coverage only applies to losses under Coverages A and B D The cost of bail bonds is included up to $250
Supplementary payments will reduce the limits of the policy
Which of the following is not included in the definition of an insured contract? A Sidetrack agreement B Contract for lease of premises C Easement agreement D Tenant agreement
Tenant agreement
Which of the following conditions would not be found in a CGL policy written on the occurrence form? A The Insured's Right to Claim Information B Duties in the Event of Occurrence, Claim, or Suit C Severability D Representations
The Insured's Right to Claim Information
Coverage B of the CGL would cover which of the following claims? A A new business misappropriates the insured's slogan B The insured was accused of causing a business associate to be falsely arrested C A competitor illegally uses the insured's copyright material D A customer falls on the insured's premises and breaks his leg
The insured was accused of causing a business associate to be falsely arrested
All of the following are true of the supplemental extended reporting period, except: A The insurer may cancel it after the premium has been paid by the insured B The one time premium may not exceed 200% of the annual premium for the coverage part C It must be purchased within 60 days after the end of the policy D It is an optional extended reporting period of unlimited duration
The insurer may cancel it after the premium has been paid by the insured
All of the following are true of the supplemental extended reporting period, except: A The one time premium may not exceed 200% of the annual premium for the coverage part B The insurer may cancel it after the premium has been paid by the insured C It must be purchased within 60 days after the end of the policy D It is an optional extended reporting period of unlimited duration
The insurer may cancel it after the premium has been paid by the insured
Which of the following would not reduce the general aggregate limit under a CGL? A A small fire in the insured's office causes damage to the leased premises B The insured misappropriates the advertising slogan of a competitor C A customer is injured on premises and the insured calls an ambulance to take the injured party to the hospital for treatment D The insurer pays a claimant injured by a product made by the insured
The insurer pays a claimant injured by a product made by the insured
Which of the following is false about the CGL policy form? A The limits of the policy stated in the Declarations are the maximum amounts payable for the life of the policy B Section III of the Commercial General Liability Coverage Forms describes the limits of insurance C The general aggregate limit is the most the company will pay for all damages under Coverage A, Coverage B, and medical payments under Coverage C, except for products and completed operations claims D The per occurrence limit is the most the company will pay for damages under Coverage A and Coverage C, arising out of any one occurrence
The limits of the policy stated in the Declarations are the maximum amounts payable for the life of the policy
Which of the following is true regarding the Supplemental Extended Reporting Period? A Cancellation by the insurer requires 90 days notice of cancellation B The premium is a one-time charge C It covers occurrences that take place after the policy term, during the Supplemental Extended Reporting Period D The charge for the Supplemental Extended Reporting Period may not exceed the annual premium of the expiring policy
The premium is a one-time charge
All of the following are true of the extended reporting period, except: A Under the mini tail, the insurer must be notified of a claim within 60 days after the end of the policy period B The extended reporting period does not increase the policy limits C The supplemental extended reporting period must be purchased at the beginning of the policy period D Under the supplemental extended reporting period, the insured must request coverage within 60 days after the end of the policy
The supplemental extended reporting period must be purchased at the beginning of the policy period
What are the territorial limits of the Commercial General Liability Coverage Part of the Commercial Package Policy?
United States, its territories and possessions, Puerto Rico and Canada
