Getting to know. Northeast Agencies, Inc. June Presented by:

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Getting to know

COMMERCIAL

LIABILITY INSURANCE

Presented by:

Northeast Agencies, Inc.

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Business Liability Coverage

¡ Provides Liability coverage for business operations if a

claim arises due to bodily injury to customers of the insured or general public. The insurance covers a “third party”:

l Bodily Injury

l Property Damage

l Limited Contractual Liability

l Products/Completed Operations

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Premises / Operations Coverage

¡ Premises coverage included in the Business Liability policy.

Premises exposures arising at the place of business, such as a store or office. (A slick floor or loose board could

cause an injury).

¡ Operations exposure related to the insured’s ongoing operations, generally associated with manufactures,

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Products / Completed Operations

continued

¡ Must be away from the premises and arising out of the insured’s work or product.

¡ Products exposure is the possibility that a product sold, manufactured, or distributed by the insured might injure a person.

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Contractual Liability

¡ A CGL coverage that extends to any liability the insured may assume by entering into various types of contracts such as; building leases, easements, an agreement to indemnify a town or city if required by ordinance, and elevator

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Personal Injury / Advertising Injury

¡ Personal injury provides protection if the insured is accused

of publishing inaccurate information that slanders or libels a person or organization, or publishes material that violates a persons right of privacy, false arrest, or wrongful eviction.

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Fire Legal Liability

¡ Coverage for fire damage caused by negligence on the part of an insured to premises rented to the named insured. If a fire occurs because of negligence of the insured and

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Medical Payments

¡ Provides reimbursement for third party medical expenses caused by an accident on the insured’s premises,

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Professional Liability

Errors & Omissions

¡ Not included in the Standard Business Liability policy.

¡ Covers losses that result from the insured’s failure to perform the expected duties of his profession.

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True or False?

General Liability will cover a contractor if their work is faulty or performed “negligently.”

FALSE

FALSE – Faulty workmanship is not covered under the CGL. The following slides address this exclusion and some

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Important CGL Exclusions

What does this mean?

¡ CGL will not cover property left in the care, custody or control of a contractor. This exposure should be covered with an Inland Marine Policy (Bailee’s Policy.)

EXCLUSION

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Important CGL Exclusions

¡ CGL will cover property damaged by the contractor,

except for the “particular” part they are performing work to at the time of loss.

EXCLUSION

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“Particular” Part Example

¡ The CGL may respond by providing property damage to all parts of the building other than the plumbing and all parts of the plumbing system because the plumber was working on that “particular” part of the building at the time of loss.

¡ Remember that only the insurance company adjuster will determine the actual claims coverage due to the specific circumstances involved at the time of loss.

EXAMPLE

EXAMPLE: A plumbing subcontractor is performing work on a building by soldering copper pipes. He accidentally starts the

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Important CGL Exclusions

¡ CGL will not cover a contractor’s faulty work. (This exposure can be covered through a Performance Bond for a specific project and time frame.)

EXCLUSION

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Commercial Liability Limits

¡ Occurrence limit is any single accident, including bodily

injury or property damage, which occurs during the policy period.

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Premium Basis

¡ Premiums for General Liability are based on one of the following factors:

l Annual Payroll / Number of Employees (auditable)

l Annual Gross Receipts (auditable)

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Loss Runs

¡ Mandatory for most types of coverages if there is prior insurance coverage.

¡ Three to five years in time.

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Application Completion

This is the most important job an agent performs.

¡ Because the underwriter does not know the specific risk, the acceptance and rating of an insured is based primarily on the information provided by the agent.

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Timing and Rates

¡ A completed submission will allow the underwriter to better judge the acceptability of a risk, as well as price that risk accordingly.

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Sample Applications

¡ Contractors On-Line Application.

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Thank You!

NORTHEAST AGENCIES, INC.

2495 Main Street, Suite 209 Buffalo, New York 14214

Phone: (800) 333-0980

121 Interpark Blvd., Suite 401 San Antonio, Texas 78216

Phone: (800) 844-3899

6950 Cypress Road, Suite 105 Plantation, Florida 33317

Phone: (866) 290-9680

960 McCourtney road, Suite C Grass Valley, CA 95949

Phone: (866) 404-1083

www.NEAgencies.com Allstate