Property & Casualty Insurance Exam (National Portion)Casualty InsuranceMedium
A business owner has a Commercial General Liability (CGL) policy. A customer slips and falls on a wet floor inside the business, sustaining a broken arm. Which part of the CGL policy would primarily respond to the customer's medical bills, regardless of fault?
- ASupplementary Payments
- BCoverage C - Medical Payments
- CCoverage B - Personal and Advertising Injury Liability
- DCoverage A - Bodily Injury and Property Damage Liability
Show answer & explanationAnswer & explanation
Correct answer: B. Coverage C - Medical Payments
Coverage C - Medical Payments in a CGL policy provides no-fault coverage for medical expenses incurred by a person injured on the insured's premises or due to the insured's operations, regardless of legal liability.
Why the other options are wrong
- A. Supplementary Payments cover defense costs, bail bonds, and lost earnings for the insured, not direct medical expenses for an injured third party.
- C. Coverage B addresses non-physical harms like libel, slander, or copyright infringement, not bodily injury from a slip and fall.
- D. Coverage A requires legal liability and covers damages the insured is legally obligated to pay, not no-fault medical payments.
CGL Coverage C - Medical Payments
A section of the Commercial General Liability (CGL) policy that provides limited, no-fault coverage for medical expenses for bodily injury sustained by a person on the insured's premises or as a result of the insured's operations.
- No-fault coverage, paid regardless of legal liability.
- Covers reasonable and necessary medical expenses.
- Applies to injuries sustained on the insured's premises or from operations.
- Has a specific per-person limit, separate from liability limits.
Memory trick: CGL Med Pay: Care for Casualties, No Court Needed.