CISR Commercial Casualty I Lesson 5
L Exam 100% Correct.
Named Insureds - ANSWERThis insured is any person or organization whose name
appears on the Declarations of the insurance policy, who has the broadest coverage
available on the policy, and who may be responsible for premium.
Automatic Insureds - ANSWERThis is an insured by virtue of language which
already exists in the policy (Who Is An Insured section) such as employees of the
named insured or the named insured's real estate manager.
Additional Insureds - ANSWERThis refers to one or more persons or organizations
other than the person or organization named on the Declarations of an insurance
policy who are also covered for certain losses under the policy. These insureds are
added by endorsement.
What creates the need to be named an additional insured; and, more importantly,
why would the named insured want to add someone as an additional insured? What
are the two primary reasons? - ANSWER1. A close relationship between the named
insured and the person or organization.
2. A contract requirement.
What creates the need to be named an additional insured? - ANSWERWhile there
are several reasons behind these requests, the primary reason is to provide
additional insureds coverage for losses for which they may be legally liable due to
their business relationship with your client. They want to protect themselves from
liability that arises out of your client's activities.
Other Reasons for Additional Insured Status - ANSWER1. It may assure greater
safety in a risk finance transfer.
2. It creates the potential for the availability of higher limits of coverage.
3. It can give them direct rights to your client's insurance.
4. It may protect them from the potential risk of subrogation.
5. It creates the potential to reduce the cost of their insurance.
Problems associated with additional insured status for the named insured -
ANSWER1. Diminution of Policy Limits
2. Unintended Coverage Granted to the Additional Insured (especially with
manuscript Ai endts)
3. Compliance Problems (breach of contract not covered by CGL)
Problems associated with additional insured status for the additional insured -
ANSWER1. May lose control of defense and investigation
2. "Other insurance" conflicts
3. Limited coverage for the additional insured
4. Dependency on another party's Insurance
, Problems associated with additional insured status for the additional insured AND
named insured - ANSWER1. Loss of Control Over Defense and Investigation
2. Other Insurance Disputes
3. CG 20 10 Endorsement Form Edition Dates - Limited Coverage for Additional
Insured
CG 2010 Completed Operations Liability - ANSWERLegal liability results when injury
to others or damage to property of others is caused by defective or improper
workmanship.
The exposure applies to the named insured's work. This exposure begins once the
operations have been completed and the named insured leaves the work site.
CG2010 Negligence - ANSWERFailure to exercise care that an ordinary prudent
person would exercise. Negligence requires the following:
1. Duty owed to another
2. Breach of that duty
3. Actual injury
4. Proximate cause
Sole negligence indicates negligence by a single party; contributory negligence
indicates that more than one party has met the requirements for negligence in a
cause of action.
CG2010 1185 Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization - ANSWERThis edition date uses "your work" (instead of
"your ongoing operations" as used in other editions). Since the term "your work" is
associated with "completed operations", this edition includes "completed operations"
for the additional insured. This edition date provides the broadest coverage for the
additional insured.
CG2010 1093 Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization - ANSWERThis edition replaces "your work" with "your
ongoing operations" performed for that additional insured. Since the term "your work"
is associated with "completed operations", its replacement with "ongoing operations"
attempts to eliminate completed operations coverage for those additional insureds
covered by this endorsement. After all, once work is completed it is no longer
ongoing.
Who Is An Insured (Section II) is amended to include as an insured the person or
organization shown in the Schedule, but only with respect to liability arising out of
your ongoing operations performed for that insured.
CG2010 0397 Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization - ANSWERThe endorsement name changes to:
ISO CG 20 10 - Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization
Who Is An Insured language remains the same as in the 10/1993 edition.
L Exam 100% Correct.
Named Insureds - ANSWERThis insured is any person or organization whose name
appears on the Declarations of the insurance policy, who has the broadest coverage
available on the policy, and who may be responsible for premium.
Automatic Insureds - ANSWERThis is an insured by virtue of language which
already exists in the policy (Who Is An Insured section) such as employees of the
named insured or the named insured's real estate manager.
Additional Insureds - ANSWERThis refers to one or more persons or organizations
other than the person or organization named on the Declarations of an insurance
policy who are also covered for certain losses under the policy. These insureds are
added by endorsement.
What creates the need to be named an additional insured; and, more importantly,
why would the named insured want to add someone as an additional insured? What
are the two primary reasons? - ANSWER1. A close relationship between the named
insured and the person or organization.
2. A contract requirement.
What creates the need to be named an additional insured? - ANSWERWhile there
are several reasons behind these requests, the primary reason is to provide
additional insureds coverage for losses for which they may be legally liable due to
their business relationship with your client. They want to protect themselves from
liability that arises out of your client's activities.
Other Reasons for Additional Insured Status - ANSWER1. It may assure greater
safety in a risk finance transfer.
2. It creates the potential for the availability of higher limits of coverage.
3. It can give them direct rights to your client's insurance.
4. It may protect them from the potential risk of subrogation.
5. It creates the potential to reduce the cost of their insurance.
Problems associated with additional insured status for the named insured -
ANSWER1. Diminution of Policy Limits
2. Unintended Coverage Granted to the Additional Insured (especially with
manuscript Ai endts)
3. Compliance Problems (breach of contract not covered by CGL)
Problems associated with additional insured status for the additional insured -
ANSWER1. May lose control of defense and investigation
2. "Other insurance" conflicts
3. Limited coverage for the additional insured
4. Dependency on another party's Insurance
, Problems associated with additional insured status for the additional insured AND
named insured - ANSWER1. Loss of Control Over Defense and Investigation
2. Other Insurance Disputes
3. CG 20 10 Endorsement Form Edition Dates - Limited Coverage for Additional
Insured
CG 2010 Completed Operations Liability - ANSWERLegal liability results when injury
to others or damage to property of others is caused by defective or improper
workmanship.
The exposure applies to the named insured's work. This exposure begins once the
operations have been completed and the named insured leaves the work site.
CG2010 Negligence - ANSWERFailure to exercise care that an ordinary prudent
person would exercise. Negligence requires the following:
1. Duty owed to another
2. Breach of that duty
3. Actual injury
4. Proximate cause
Sole negligence indicates negligence by a single party; contributory negligence
indicates that more than one party has met the requirements for negligence in a
cause of action.
CG2010 1185 Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization - ANSWERThis edition date uses "your work" (instead of
"your ongoing operations" as used in other editions). Since the term "your work" is
associated with "completed operations", this edition includes "completed operations"
for the additional insured. This edition date provides the broadest coverage for the
additional insured.
CG2010 1093 Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization - ANSWERThis edition replaces "your work" with "your
ongoing operations" performed for that additional insured. Since the term "your work"
is associated with "completed operations", its replacement with "ongoing operations"
attempts to eliminate completed operations coverage for those additional insureds
covered by this endorsement. After all, once work is completed it is no longer
ongoing.
Who Is An Insured (Section II) is amended to include as an insured the person or
organization shown in the Schedule, but only with respect to liability arising out of
your ongoing operations performed for that insured.
CG2010 0397 Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization - ANSWERThe endorsement name changes to:
ISO CG 20 10 - Additional Insured - Owners, Lessees or Contractors - Scheduled
Person or Organization
Who Is An Insured language remains the same as in the 10/1993 edition.
