Business Insurance Flashcards

A DC business has employment practices liability insurance (EPLI). Which claim would this policy cover?

Answer: An employee alleging wrongful termination or workplace discrimination

EPLI covers claims by employees (or prospective employees) alleging wrongful termination, discrimination, harassment, or other employment-related wrongful acts.

Which DC business insurance provision ensures the insurer pays defense costs in addition to (not within) the policy limits?

Answer: Defense outside the limits (supplementary payments)

When defense costs are 'outside the limits,' also called supplementary payments, defense costs are paid in addition to the liability limit, so the limit is reserved for judgments and settlements.

A DC general contractor requires all subcontractors to add them as an 'additional insured' on their CGL policies. What does this provide?

Answer: The general contractor has coverage under the subcontractor's policy for claims arising from the subcontractor's work

Additional insured status extends the subcontractor's CGL policy to cover the general contractor for claims arising from the subcontractor's operations.

What is a 'waiver of subrogation' endorsement in a DC commercial policy?

Answer: The insurer agrees not to seek recovery from a specified third party (e.g., a general contractor) after paying a claim

A waiver of subrogation endorsement prevents the insurer from pursuing a specified third party (often required by contract) for reimbursement after paying the insured's claim.

A DC restaurant owner's liquor liability coverage would respond to which of the following claims?

Answer: A customer suing the restaurant for serving alcohol to a visibly intoxicated patron who then caused a car accident

Liquor liability (Dram Shop) insurance covers claims arising from the insured's sale or service of alcohol to an intoxicated patron who then causes injury to a third party.

Which of the following best describes 'occurrence' versus 'claims-made' CGL coverage for DC businesses?

Answer: Occurrence covers claims for incidents that happen during the policy period regardless of when the claim is filed; claims-made covers claims filed during the policy period for incidents during the retro date or later

Occurrence coverage triggers based on when the injury or damage happened (during the policy period). Claims-made triggers based on when the claim is filed (during the policy period) for incidents on or after the retroactive date.