Casualty Insurance Basics
Liability fundamentals
Liability coverage pays on behalf of an insured who is legally liable for injury to others, and provides a defense. Negligence requires duty, breach, proximate cause, and damages. Defenses include contributory or comparative negligence and assumption of risk; doctrines such as res ipsa loquitur and vicarious liability shift the burden of proof or responsibility. Absolute/strict liability applies to inherently dangerous activities, products, and workers' compensation.
Commercial general liability
The CGL is usually an occurrence form (injury during the policy period). Coverage A covers bodily injury and property damage; Coverage B covers personal and advertising injury (libel, slander, false arrest, invasion of privacy - not bodily harm); Coverage C covers medical payments regardless of fault. Limits include a general aggregate, products-completed operations aggregate, each occurrence, damage to premises rented, and medical expense. Key exclusions: care, custody, and control of property, contractual liability, employer's liability, auto, workers' comp, and pollution. Claims-made forms respond to claims reported during the policy period and depend on the retroactive date; extended reporting (“tail”) matters.
Auto, workers' comp, and other casualty
The personal auto policy has Part A liability, B medical payments, C uninsured/underinsured motorists, and D damage to your auto (collision and other than collision). The business auto form uses symbols to designate covered autos. Workers' compensation pays medical, disability income (temporary total, permanent partial, permanent total), and death benefits; the exclusive remedy doctrine bars employee lawsuits, which is why employers liability coverage exists. Umbrella/excess sits above underlying limits; professional liability (E&O), D&O, and EPLI respond where a CGL will not.
Traps
- “Personal injury” in a CGL does not mean bodily injury.
- The CGL excludes injury to the insured's own employees.
- UM/UIM responds to the other driver's fault, not yours.
Rule of thumb
Ask: who is claiming, against whom, and when did the injury occur (not when the claim arrived)?