Risk & Business Magazine JGS Insurance Magazine Fall 2019 - Page 29

COMMERCIAL GENERAL LIABILITY EACH OCCURRENCE LIMIT This is the maximum that the insurer is obligated to pay for any damages within Coverage A and expenses within Coverage C. Despite a separate General Aggregate Limit for Products-Completed Operations, all damages paid under Coverage A and all expenses paid under Coverage C are subject to the Each Occurrence Limit. For the purpose of this article, an “occurrence” by policy definition is defined as an accident, including continuous or repeated exposure to substantially the same general harmful conditions. An example of this would be a cheese processor preparing a shipment improperly, resulting in the sale of contaminated or otherwise compromised cheese. As a result, multiple people become ill. Each one of those individuals then sues the company. Does this count as multiple occurrences or does it count as one? There are two views. The first looks at the cause of the liability, which would consider them all to be the same occurrence. The second looks at the effect, which would find each individual injury to be a separate occurrence. DAMAGE-TO-PREMISES-RENTED-TO- YOU LIMIT This separate limit applies to fire damage to premises rented from a landlord by the insured and to damage—regardless of cause—to premises or their contents occupied for seven days or less by the insured. This limit applies to any premises and is a sublimit of the Each Occurrence limit. Payments under this coverage reduce the Each Occurrence and General Aggregate limits. MEDICAL EXPENSE LIMIT Medical Expenses are Coverage C, and they are meant to pay for reasonable medical treatments resulting from accidents or injuries, regardless of who is at fault. Like the Damage-to-Premises-Rented-to-You Limit, payments under this coverage reduces the Each Occurrence and General Aggregate limits. Understanding not only your CGL policy but also how limits can come into play if a claim is made are essential to successfully protecting your organization from risk. After all, having coverage is good, but having the wrong understanding isn’t going to help anyone. It should be more than apparent that the way limits work and connect to each other are complicated, and having a professional there to help is essential. BY: GWENYTH P. LUU, CLCS DIRECTOR - COMMERCIAL LINES JGS INSURANCE Gwenyth Luu helps organizations improve their bottom line and lower their total cost of risk by implementing the JGS Proactive Service Platform. The JGS Proactive Service Platform is an inclusive strategy that focuses on primary cost drivers of a risk management program. Gwenyth helps businesses understand all of their potential and actual costs and liabilities, execute an actionable strategy, and deliver superior client service and support. The JGS Proactive Service Platform is driven by continuous strategy and service delivered on a daily basis throughout the year. The service platform includes risk control strategies, claims advocacy and management, contract reviews and insurance program design reviews. 29