Coverage Options

The following outlines describe most Commercial General Liability policies, but make sure you speak to your Orr Insurance Broker for a full understanding.

Bodily Injury and Property Damage Liability

Personal Injury Liability

Medical Payments

Tenants' Legal Liability

Defense Costs

Employers Liability

Contingent Employers Liability

Professional Liability, Errors and Omissions

Directors and Officers Liability

Umberlla Policies

Employment Pracices Liability

Fiduciary Liability

Environmental Liability

Operations Coverage

Cyber Liability

                 

Bodily Injury and Property Damage Liability

If your company, product, service, personnel, or anything else associated with your company, causes physical injury, or in some way damages property or belongings, you can be held legally responsible. If that is found to be the case, you will likely be ordered to compensate them. (The intent of compensatory damages is to put things back the way they were, financially, prior to the occurrence.) Your CGL policy will cover those payments.

What is not included – you should be aware of a few things not covered under the Bodily Injury and Property Damage Liability portion of your CGL policy:

  • punitive damages (an order to pay as a form of punishment)
  • intentional injuries or damage to a person or their property (which are criminal matters)
  • injuries or damage from the use of your commercial vehicle (that’s covered by your auto insurance)
  • injuries to employees or damage to their property (which should be covered by their disability or property insurance)
  • damage to property you own, rent or occupy (covered by your property insurance)

Personal Injury Liability

The term 'personal injury' can be confusing because of its specific meaning in the insurance world. While most people associate 'personal injury' with physical injury, in a CGL policy it refers to damage to a person's character, reputation and position in the community as a result of libel (in print) or slander (verbal defamation.)

What is not included – A liability policy is to protect you if you're accused of libeling or slandering someone – not when someone slanders or libels you. Typical situations not covered include statements known to be untrue when said, as well as damage caused by statements that are illegal or go against ordinances or by-laws.

 

Medical Payments

This provision in your CGL policy covers a person's minor medical expenses from an accident at your company premises, or as a result of your company's operations – even if you are not held legally liable for the accident. In practice, this is often a way to avoid a costly lawsuit.

What is not included – This coverage typically excludes everyone that's also "excluded" from coverage under Bodily Injury & Property Damage (above), and casual workers and tenants who injure themselves in their own unit.

 

Tenants' Legal Liability

If you rent or lease your office, workspace or retail space, and are held legally responsible for a fire, explosion, smoke damage, or other damage caused by fire protection (such as sprinklers or extinguishers), this coverage will pay compensatory damages. This applies only to damages of the rented premises – not the property or contents (product, inventory, fixtures, etc.) your business owns.

What is not included – Intentional destruction of property is not covered.

 

Defense costs

Your CGL coverage includes legal expenses for certain liability claims brought against your business – regardless of who is at fault. Your insurance company will defend you in court and pay compensatory damages that you are required to pay, subject to your policy limits.

 

OTHER BUSINESS LIABILITY INSURANCE OPTIONS

 

Employers Liability

A regular CGL policy typically excludes Bodily Injury to an employee, which is typically covered under provincial Workers’ Compensation. If your business does not require Workers’ Compensation, you can purchase Employers Liability coverage instead to financially protect your employees in the event of Bodily Injury.

 

Contingent Employers Liability

A Contingent Employer Liability policy will cover an employee who is ineligible for workers compensation benefits, such as an occasional employee, instances where an employee is injured doing a task not within their regular duties, or cases where an employer must reimburse the Workers’ Compensation Board. 

 

Professional Liability, Errors and Omissions

This fills the gap that a general liability policy does not cover. Particularly, it covers a professional who makes an error, does not disclose something, or makes a negligent decision.

Alternatively, an Errors and Omissions policy can provide that protection, plus protection for the large legal fees that can accompany these types of claims. Your Orr Insurance Broker can help you decide which fits your needs better.

 

Directors and Officers Liability

Directors and Officers liability insurance protects past, present and future corporate directors and officers of profit or non-profit companies from damages or defense costs in the event they are sued for activity while they were with that company. Except for criminal acts, these risks can be insured under other forms of the policies – your Orr Insurance Broker can explain more thoroughly. (For obvious reasons, a “D&O” policy will not cover deliberate criminal or dishonest acts, libel, slander, bodily injury or property damage – criminal acts are not insurable in any case.)

Non-Profit D&O insurance typically covers the organization’s duty to indemnify and may also cover the organization itself – an important consideration if a not-for-profit is engaged in advocacy for change. In addition to insuring damages, it will pay legal defense costs.  It should also cover members, volunteers, staff and employees.

 

Umbrella Policies

“Umbrellas” serve three main functions:

  • high excess coverage over and above a primary or underlying liability policy
  • broader coverages than a primary liability policy, usually excess of a self-insured retention
  • automatically replace coverage provided by underlying policies when they are reduced or exhausted by losses – sometimes know as a “drop-down” feature.

Ordinarily used for commercial risks, umbrellas have also been developed for personal applications. Umbrella policies were introduced to North America by Lloyd's around 1947 and are offered today by most liability insurers – your Orr Insurance Broker can help you decide if an Umbrellas would be relevant to your needs.

 

Employment Practices Liability

This form of business insurance fills some of the gaps left by CGL, Umbrella, and Directors and Officers policies (explained above). Employment Practices Liability insurance protects the corporate entity, its directors and employees if a claim is brought by, on behalf of, a current, prospective or past employee for a broad range of allegations. 

         

Fiduciary Liability

Failure to comply with fiduciary guidelines can result in lawsuits from employees, former employees, and beneficiaries. Sometimes known as “Pension Trust liability”, Fiduciary Liability insurance provides coverage for claims and defense costs in cases of alleged financial wrongdoing, either by the insured or someone under the insured’s responsibility – meaning, the sponsor corporation, as well as the individual fiduciaries, can be at risk.

Such wrongful acts include violations of the responsibilities, obligations, or duties imposed on fiduciaries as well as acts, errors, or omissions in the performance of the duties of the administrator. In this context, the definition of a fiduciary is very broad: any person named in the plan, or any person who exercises discretionary authority or control in the management or administration of the plan or its assets.

 

Environmental Liability

This type of policy is site-specific, providing cleanup and third party liability coverage for premises owned or operated by the policyholder, such as a gas station.

 

Operations Coverage

These policies cover cleanup and third party liability from operations at third party job sites, either by or on behalf of the insured. Examples include trucks carrying hazardous material and spills.

 

Cyber Liability

Cyber Liability deals with first and third-party risks associated with e-business, the Internet, networks and data assets. This includes privacy issues, virus transmission, and other serious problems between parties on the Web.