Types of Casualty Policies, Bonds and Related Terms

CGL coverage A

-bodily injury -property damage

garage section 1- covered autos

-defines covered auto using designation symbols

workers compensation benefits

-medical payments: unlimited -disability income: loss of wages; retroactive -rehabilitative expenses: vocational training -death benefit: funeral and burial expenses, weekly income benefits to spouse and children

occurrence form for CGL

-most common form used for a wide variety of businesses

insured

-named insured -family member -person using vehicle with insured's permission -any person while occupying a covered vehicle -any person entitled to recover damages to injuries to the named insured

collision

a covered vehicle or nonowned auto is impacted by another vehicle or object

premises liability

any losses on premises

contract bond

bid bonds- guarantee the issue of a performance bond after a contract is awarded to a contractor performance bonds- guarantee that the principal will complete the contract as agreed upon labor and materials bonds- guarantee work and materials will be delivered free and clear of liens or other burdens

business auto vs. garage

business auto- covers losses during the policy period and within the coverage territory garage- covers losses at the time of the actual loss, NOT when the work was done

limit of liability

either actual cash value or amount needed for repair or replacement

commercial crime

employee -for 30 days after termination -temporary employee -managers directos -former employees banking premises -interior of a premises occupied by a banking institution or similar facility funds -money and securities money -currency, coin, bank notes in current use securities -negotiable or non-negotiable instruments

operations liability

losses from services or operations

general form structure for garage coverage

section 1- covered auto section 2- liability section 3- garage keepers liability section 4- physical damage section 5- conditions section 6- definitions

combined single limit policy

single limit for bodily injury and property damage

guarantor

surety bonding company, pays loss to obligee

liquor liability

-"dram shop" liability -bars, restaurants, distributors

split limit

-1st limit bodily injury per person -2nd limit bodily injury per accident -3rd limit property damage per accident

employment practices

-abuse of employee -sexual harassment -wrongful termination

fiduciary liability

-administer pension or employee benefit plans -if the plan pays the premium, individual trustees of the plan may be sued

mobile equipment coverage

-any equipment that is not insured on auto policy

covered auto

-any vehicle shown in the declarations, including newly acquired auto or trailer

common policy conditions

-bankruptcy: does not relieve the insurer from its obligations -policy changes: may only be effected by endorsements -fraud: no coverage if insured has made fraudulent statements -subrogation: insurer's right to recover payment -policy period and territory -termination: right to cancel, 10 days notice

commercial auto coverage forms

-business auto -business auto physical damage -garage coverage -motor carrier coverage

section 3- physical damage

-comprehensive: any cause other than collision or overturn -specified causes of loss -collision -towing -glass breakage: hitting a bird or falling objects

the jones act

-covers ships' crews (seamen) -injuries in navigable water for international or interstate commerce

part D

-damage to your auto -collision and other than collision -optional coverage, subject to deductible -only applies when a premium is shown

part e

-duties after a loss -prompt notification of loss -cooperating with the insurer -forwarding any pertinent legal papers -submitting to a physical exam -allowing insurer access to medical records -submitting proof of loss -notifying police of hit and run -protecting the property from further loss -allowing the insurer to inspect and appraise the damaged property

commercial crime coverages

-employee theft -forgery or alteration -inside- theft of money or securities -inside- robbery or safe burglary of other property -outside- theft, disappearance or destruction -computer fraud -fund transfer fraud

elective laws

-employers are not subject to state workers compensation laws -employer loses common law defenses against liability suits

federal employers liability act (FELA)

-employers liability law -interstate railroad liability -section 2 of workers compensation -covers lost earnings by railroad employees -compensation for pain and suffering -legal action within 3 years

monopolistic state

-employes are required to purchase workers compensation insurance from a state-operated entity

personal umbrella coverage

-excess over primary coverage -million dollar increments -requires underlying minimum -no underlying coverage for personal injury -self-insured retention (SIR)

excess coverage- stand alone

-exclusive in terms, conditions coverage -does not rely on primary policy -coverage via provisions may be smaller or greater with own exclusions -add on -personal injury

CGL coverage A exclusions

-expected or intentional injury -contractual liability -liquor liability -pollution -war -damage to property -workers compensation -electronic data

excess policy

-follow form -coverage mirrors the underlying policy

excess coverage- follow form

-follows terms and conditions on the primary policy -almost identical to the primary policy -covers exactly what is on primary policy

US longshore and harbor workers compensation act

-for persons in maritime employment (except for seamen) -must meet situs and status test -for injuries that occur in navigable waters or on docks or adjoining wharfs, piers -benefits just like workers compensation

garage section 6- defintions

-garage operations -products -work performed by the insured

part f

-general provisions -describes the conditions that apply to all coverage parts in addition to the conditions that apply to the individual coverages

fidelity bonds

-guarantee honesty and trust

license and permit bonds

-guarantee that the recipient will comply with laws and regulations -required by state and local governments

surety bond

-guarantees the performance of someone else

joint ownership endorsement

-individuals who reside in the same household who are not spouses or nonresident relatives -must be listed in the endorsement -owns car but not one driving the car (kids car)

CGL coverage B exclusions

-knowingly publishing false material -criminal acts -breach of contract -copyright infringement -media and internet-type businesses -violation of communication laws

loss sustained form

-loss occurred and was discovered during the policy period -loss may not be discovered until later but must be discovered within 1 year

discovery form

-loss occurred at any time and was discovered during the policy period

aggregate limit

-maximum limit of coverage under a liability policy -applies regardless of number of claims or number of accidents -limits restored at anniversary of policy

CGL coverage C

-medical payments

part b

-medical payments -medical and funeral expenses -pays per person, per accident -for accidents up to 3 years old

directors and officers

-neglect, breach of duty, wrongful acts -does not cover fines, penalties or punitive damage

retroactive date

-no coverage before this date -inception date of first claims-made policy -future renewals with same insurer have same retro date -uninterrupted coverage from an occurrence policy to latest claims-made -eliminates duplication

excess or surplus lines

-non admitted insurers -do business internationally -hard to place risks, extraordinary (ex. commercial airlines) -not readily available

part D other provisions

-payment of loss -no benefit to bailee (ex. repair shop damages car) -other sources of recovery -appraisal

UIM coverage

-pays the difference between the insured's UIM limits and the at-fault driver's bodily injury limits -helps compensate for insufficient coverage

CGL coverage B

-personal injury -advertising injury

garage section 4- physical damage

-physical damage to own cars non dealer- coverage is identical to the auto physical damage coverage auto dealer- covers autos being held for sale or in transit, symbol 31

underlying policy

-primary liability policy

auto

-private passenger -temporary substitute -owned trailer

errors and omissions

-protects insurance agents -professional liability in fields other than medical -covers failure to use due care and degree of skill expected

compulsory laws

-requires all employees to provide workers compensation coverage -exclusions may apply regarding staff size or employment type -apply to most states

business auto form sections

-section 1: covered auto -section 2: liability -section 3: physical damage -section 4: business auto conditions -section 5: defintions

garage coverage

-sell -service or repair -park or store

umbrella

-stand-alone -coverage can be greater or less than the underlying policy

section 2- liability

-third-party insurance -insured legal responsibilities in an accident: bodily injury, property damage, legal fees

professional liablity

-those who provide services for a fee -physician, surgeon, dentist malpractice -lawyers -"consent to settle a loss"- if insured agrees to settle outside court

part c

-uninsured/underinsured motorists -pays for bodily injury if the vehicle owner who caused damages: -has no insurance or bond -has insurance amount that is less than required by law -has insurance from an insolvent company -hit and run accident

coverage territory

-united states -US territories and possessions -Canada

claims-made form for CGL

-used for specialty coverages such as professional liability, malpractice, E&Os

coverage trigger

-what makes a policy respond to a claim

exclusive remedy

-workers compensation is the exclusive or sole remedy for injuries -employees may not file injury lawsuits against their employer -exclusions may apply -not to use own health insurance

section 1- covered auto symbols

01- any auto including owned leased hired or borrowed 02- owned autos only 03- owned private passenger autos only 04- owned autos other than private 05- owned autos subject to no-fault 06- owned autos subject to a compulsory uninsured motorists law 07- specifically described autos- common 08- hired autos only 09- non owned autos only

garage section 2- liability coverage

1. garage operations- other than covered auto 2. garage operations- covered autos

garage form symbols

21- any auto- common 22- owned autos only (used for non dealers only) 23- owned private passenger autos only (used for non dealers only) 24- owned autos other than private passenger autos only (used for non dealers only) 25- owned autos subject to no-fault 26- owned autos subject to a compulsory uninsured motorists law 27- specifically described autos- most common 28- hired autos only 29- non owned autos used in your garage business 30- autos left with you for service, repair storage or safekeeping 31- dealer's autos

products and completed operations

covers bodily injury or property damage occurring away from the insured's premises and arising out of the insured's product or work

garage keepers liability

covers damage for which the insured is liable to customers auto left in the insured's care custody control -comprehensive: all loss to customers' autos except collision or overturn -specified: loss to a customer's auto due to fire, lightning explosion theft mischief or vandalism -collision

garage section 3- garage keepers

covers damages for which insured is liable to customer's auto left in the insured's care, custody or control -triggered by symbol 30 -taken possession of vehicle

other-than-collision

damage to covered vehicle caused by: falling objects, fire, contact with animals etc

miscellaneous type vehicle endorsement

expands definition of a covered auto to include -motorcycles -motorhomes -other recreational vehicles -dune buggies -golf carts NO liability and medical payments exclusions NO coverage for vehicles rented or borrowed

judicial bonds

for legal and contractual obligations appeal bonds- guarantee judgment will be paid after a person appeals to higher court attachment bonds- guarantee that if the action to attach property was wrong, damages suffered will be paid release for attachment bonds- order an attachment bond to be discharged resulting in return of property bail bonds- secure release of person from jail cost bonds- guarantee plaintiff will be bale to pay court costs injunction bonds- guarantees damages will be paid to the injured party if the injunction should not have been made

safe burglurary

forced entry resulting in the theft of contents from a safe or the safe itself

premise and operations

hazards related to ownership, maintenance or use of the insured's premises and all business operations

garage section 5- conditions

identical to business auto coverage form except for policy period, coverage territory condition -BI and PD must occur within the coverage territory to be covered -policy language affords coverage for losses resulting from insured's products

occurrence

if BI or PD occurs during the policy period, the claim will be paid (even if submitted after policy expiration)

claims-made

if BI or PD occurs on or after the retroactive date, and the claim is made during the policy period, claim will be paid -after policy expires there is no coverage

personal injury

injury to a persons character

principal

makes a promise, purchases a bond

advertising injury

nonphysical injury to a business (defamation)

workers compensation coverage parts

part one- workers compensation part two- employers liability part three- other states insurance: temporary coverage for incidental exposure in other states part four- your duties if injury occurs part five- premium: $100 of annual payroll; right of insurers to audit books part six- conditions

obligee

to whom the promise is made

newly acquired wuto

vehicles acquired by the insured during policy period

competitive state

workers compensation is purchased by employers from private insurers, mandated by state regulations