I85PREP
⌘ K
COI Diploma study materials
COI Diploma study resources

COI Diploma: Policy Structure, Declarations, and Insuring Agreements

COI Diploma · Work through your exam, one topic at a time.

All guide sections

Policy Structure, Declarations, and Insuring Agreements

Policy Structure, Declarations, and Insuring Agreements

This domain tests your ability to read a policy the way a certificate professional must: locate the grant of coverage, the limits that cap it, and the conditions that can defeat it.

Anatomy of the contract

  • Declarations: named insured, policy period, limits, forms and endorsements schedule, premium, business description.
  • Insuring agreement: the promise, defining what is covered, where, and when.
  • Conditions: duties after loss, cancellation, other insurance, subrogation, valuation.
  • Exclusions: carve back the insuring agreement; always read them together with their exceptions.
  • Definitions: controlling language. 'You', 'insured', 'occurrence', 'suit' and 'your work' do the heavy lifting.
  • Endorsements amend the printed form; a specific manuscript endorsement generally prevails over standard wording.

Limits you must be able to read

  • Per occurrence versus aggregate: each occurrence payment reduces the general aggregate.
  • Products-completed operations aggregate is tracked separately from the general aggregate.
  • Sublimits (fire damage, medical payments, damage to premises rented to you) sit inside the occurrence limit.
  • A self-insured retention is a funding obligation of the insured; a deductible reduces the insurer's loss payment.
  • Restoration of aggregate is not automatic and must be endorsed.

Worked example

A CGL shows $1M each occurrence, $2M general aggregate, $2M products-completed operations aggregate, and a $50,000 fire damage limit. Two premises claims of $700,000 in one policy year are each paid in full under the occurrence limit and together erode the general aggregate by $1.4M. A later $900,000 products claim draws on the products-completed operations aggregate, not the general aggregate. The $50,000 limit applies only to fire damage to rented premises.

Traps

Assuming the declarations always override the body of the policy; ignoring the forms and endorsements schedule; treating the certificate as though it were the policy.