CIC Commercial Multiline - Section 5 questions with correct answers

Identify the three primary Purposes of Excess liability & Umbrella liability policies. Excess Liab - LO1 CORRECT ANSWER 1. Provides additional limits that are excess over underlying limits of insurance. ie: Auto Loss 1.8M. 2. Provides primary coverage when underlying poliy does not respond beacuse its aggregate limits of insurance are exhausted. ie: 2 GL claims 500k each; 3rd claim of $300k w/b paid by EL. It would drop down and provide primary cov over exhausted limits. 3. Provides broader coverage than the exsiting underlying insurance. Broader cov is subject to an SIR. ie: BAPs Territory def does not incl Mexico. Define "Self-Insured Retention" (SIR) and apply it. Excess Liab - LO2 CORRECT ANSWER SIR is the dolllar amount listed in the Declarations paid by the Named Insured before the insurance of the Umbrella becomes applicable. - SIR applies only when a Commercial Umbrella Policy provides broader insurance protection on claims not covered by a required underlying ins policy. -The SIR does not apply when a C. Umbrella drops down over exhausted limits or when it is excess over underlying limits. Does not apply to drop down. -SIR may be written on a per occurrence basis or on a policy period basis. Explain the importance of concurrent dates and the need for concurrent dates. Excess Liab - LO2 CORRECT ANS