Commercial Lines Insurance: Triggers, Limits, and Exclusions That Decide Claims
Two liability triggers, one property spine
Commercial lines questions cluster around three families: the Commercial General Liability (CGL) form, commercial property with business income, and commercial auto/workers compensation. Start with the CGL trigger: the occurrence form covers injury or damage that takes place during the policy period whenever the claim is later filed; the claims-made form covers claims first made during the policy period, subject to a retroactive date and an extended reporting period. Most CGL traps are really trigger questions.
Structure of the CGL
Coverage A (bodily injury and property damage), B (personal and advertising injury), and C (medical payments) each carry limits. The general aggregate caps all coverages except products-completed operations, which has its own aggregate. The damage-to-premises-rented limit and the medical expense limit are separate and do not reduce the general aggregate.
Recurring traps
- "Your work" and "your product" exclusions. The CGL pays for damage to others' property, not the cost of repairing your own defective work.
- Business auto symbols. Symbol 1 is any auto, 7 specifically described autos, 8 hired autos, 9 nonowned autos. Read the symbol before assuming coverage for an employee's personal car.
- Workers compensation. Part One pays statutory benefits with no dollar limit; Part Two (employer's liability) carries per-accident and per-employee disease limits.
- Certificates are evidence, never coverage.
Rule of thumb
For any commercial claim, ask three questions in order: Who is an insured? Is the loss within the insuring agreement and outside the exclusions? Which limit - and which aggregate - applies?