AU 62 Questions with CORRECT Answers
Question:
Accidents that could lead to claims
Answer:
A consumer dies because of impurities in a medicine sold by a pharmaceutical firm.
Question:
The tenants of an apartment building are injured by smoke inhalation, and their
personal property is destroyed by a fire that resulted from faulty electrical work
completed by a contractor several hours earlier. Personal and Advertising Injury Liability
Answer:
CGL form defines this to mean any kind of injury (such as loss of reputation, humiliation,
economic loss, or even consequential bodily injury) arising out of any of several listed
offenses. Examples of the listed offenses are false arrest, wrongful eviction, libel,
slander and infringing upon another's copyright in the insured's advertisement. It is now
such a common exposure that is is an integral part of the CGL form, but it can be
omitted if the insured does not want to buy it. This is Coverage B on the CGL form.
Question:
Medical Payments - CGL form includes Coverage C
Answer:
Medical Payments, which pays medical expenses of others in certain circumstances.
Coverage C, Medical Payments does not require the insured to be legally liable and,
therefore, is not technically liability insurance. Underwriters do not individually
underwrite this loss exposure but do consider the medical payments loss exposure as
part of the premises or operations loss exposures.
Question:
Requirements for Medical Payments Coverage
Answer:
To be covered, the medical expenses (as defined in the form) must result from bodily
injury because of an accident occurring on the insured's premises or arising out of the
insured's operations (other than completed operations) anywhere in the coverage
territory.
, Question:
Limits of Medical Payments Insurance
Answer:
Medical payments coverage has a much lower limit of insurance than either Coverage A
or Coverage B. Its role is to pay small bodily injury claims without having to establish
liability, perhaps reducing the likelihood that an accident victim will sue the insured.
Question:
Other General Liability Exposures
Answer:
While ISO general liability coverage forms are available for covering either specific
situation or specific loss exposure that are not adequately covered by the CGL form,
successful underwriting of these types of loss exposures requires a thorough
understanding of the policy provision to properly evaluate the general liability loss
exposures and to determine whether the insured's loss exposure is on that is covered
under the CGL policy or would be more appropriately covered under a different
coverage form.
Question:
The underwriter should also not ignore possible gaps, omissions, or overlaps in coverage
by automatically providing only the coverage requested by the producer. Whenever
necessary, underwriters should explain to the producer alternative methods of treating
any observed gap, omission or overlap. This elimination of gaps in coverage aids all
parties concerned, including the insurer, by avoiding misunderstandings about coverage
that might arise after a loss occurs. Components of a General Liability Coverage Part
Answer:
One or more general liability declaration forms
Question:
One or more general liability coverage forms Any applicable endorsements Under ISO
procedures, a general liability coverage part can be included in a CPP or issued in a
monoline policy that provides general liability coverage only. General Liability
Declarations
Answer:
ISO has developed separate declarations forms for use with each of its general liability
coverage forms. Some of the declarations forms also contain spaces for showing
additional information relevant to the associated coverage form.
Question:
Accidents that could lead to claims
Answer:
A consumer dies because of impurities in a medicine sold by a pharmaceutical firm.
Question:
The tenants of an apartment building are injured by smoke inhalation, and their
personal property is destroyed by a fire that resulted from faulty electrical work
completed by a contractor several hours earlier. Personal and Advertising Injury Liability
Answer:
CGL form defines this to mean any kind of injury (such as loss of reputation, humiliation,
economic loss, or even consequential bodily injury) arising out of any of several listed
offenses. Examples of the listed offenses are false arrest, wrongful eviction, libel,
slander and infringing upon another's copyright in the insured's advertisement. It is now
such a common exposure that is is an integral part of the CGL form, but it can be
omitted if the insured does not want to buy it. This is Coverage B on the CGL form.
Question:
Medical Payments - CGL form includes Coverage C
Answer:
Medical Payments, which pays medical expenses of others in certain circumstances.
Coverage C, Medical Payments does not require the insured to be legally liable and,
therefore, is not technically liability insurance. Underwriters do not individually
underwrite this loss exposure but do consider the medical payments loss exposure as
part of the premises or operations loss exposures.
Question:
Requirements for Medical Payments Coverage
Answer:
To be covered, the medical expenses (as defined in the form) must result from bodily
injury because of an accident occurring on the insured's premises or arising out of the
insured's operations (other than completed operations) anywhere in the coverage
territory.
, Question:
Limits of Medical Payments Insurance
Answer:
Medical payments coverage has a much lower limit of insurance than either Coverage A
or Coverage B. Its role is to pay small bodily injury claims without having to establish
liability, perhaps reducing the likelihood that an accident victim will sue the insured.
Question:
Other General Liability Exposures
Answer:
While ISO general liability coverage forms are available for covering either specific
situation or specific loss exposure that are not adequately covered by the CGL form,
successful underwriting of these types of loss exposures requires a thorough
understanding of the policy provision to properly evaluate the general liability loss
exposures and to determine whether the insured's loss exposure is on that is covered
under the CGL policy or would be more appropriately covered under a different
coverage form.
Question:
The underwriter should also not ignore possible gaps, omissions, or overlaps in coverage
by automatically providing only the coverage requested by the producer. Whenever
necessary, underwriters should explain to the producer alternative methods of treating
any observed gap, omission or overlap. This elimination of gaps in coverage aids all
parties concerned, including the insurer, by avoiding misunderstandings about coverage
that might arise after a loss occurs. Components of a General Liability Coverage Part
Answer:
One or more general liability declaration forms
Question:
One or more general liability coverage forms Any applicable endorsements Under ISO
procedures, a general liability coverage part can be included in a CPP or issued in a
monoline policy that provides general liability coverage only. General Liability
Declarations
Answer:
ISO has developed separate declarations forms for use with each of its general liability
coverage forms. Some of the declarations forms also contain spaces for showing
additional information relevant to the associated coverage form.
