What You Need to Know about CGL Policies

Commercial General Liability insurance—“CGL”—is an important asset for most businesses. It covers things like bodily injury, property damage, and advertising injury to others for which the insured—the policyholder—may be held liable. 

But for most policyholders, the CGL policy is a poorly understood mystery. You assume that you are completely covered, but in fact there are any number of exclusions, conditions and definitions in the standard CGL policy that may defeat or impair coverage. 

Because of the importance of the CGL policy, it's essential that policyholders have a better understanding of this critical piece of their insurance coverage. 

Most CGL policies are a disorganized mass of words and paper. It’s very helpful at the outset to step back and outline what is actually in the policy. A typical CGL policy has three parts:

  • The "Declarations” page.  This page (it usually is just one or two pages) contains a summary of the coverage provided:
    • Name of the insurance company
    • Policy number
    • Name and address of the insured(s)
    • Term (duration) of the policy (the “policy period”)
    • Monetary limits of the policy (the limits that the insurance company will pay, which may be expressed as a per occurrence limit, personal/advertising injury limit, general aggregate limit, and/or product/completed operations limit)
  • The Policy Form, which contains several sections.  For example, a standard “ISO form” CGL policy includes the following sections:[1]
    • Section 1:  Coverages and Exclusions.
      • Coverage A – Bodily Injury and Property Damage
      • Coverage B -  Personal Injury and Advertising Injury
      • Coverage C – Medical Payments
    • Section 2:  Who is an Insured.
    • Section 3:  The Limits of Insurance.
    • Section 4:  Conditions.
    • Section 5:  Definitions. 
  • Endorsements, which are modifications to the Policy Form, for example naming others as additional insureds.

Stay tuned for more in-depth exploration of the declarations page, policy form and endorsements in upcoming posts. 


[1] ISO form refers to standard policy forms issued by the Insurance Services Office (ISO)

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About the Author

Alan M. Ruley

Alan Ruley is a seasoned civil trial and appellate lawyer. He represents clients in a wide variety of disputes in federal court, state court, and the North Carolina Business Court, focusing primarily on business litigation, intellectual property, insurance coverage and recovery, banking and employment.
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