California Property & Casualty Broker-AgentCasualty InsuranceEasy
A small business owner operates a local bakery and wants to protect against claims of bodily injury or property damage arising from their business operations. Which type of commercial liability policy is primarily designed to cover these risks?
- ACommercial General Liability (CGL) Policy
- BWorkers' Compensation Policy
- CCommercial Auto Policy
- DProfessional Liability Policy
Show answer & explanationAnswer & explanation
Correct answer: A. Commercial General Liability (CGL) Policy
A Commercial General Liability (CGL) policy is designed to cover a business for claims of bodily injury or property damage to third parties arising from premises, operations, products, and completed operations.
Why the other options are wrong
- B. Workers' Compensation covers employee injuries or illnesses, not third-party claims.
- C. Commercial Auto covers liability arising from the use of business vehicles, not general business operations.
- D. Professional Liability covers errors and omissions in professional services, not general bodily injury or property damage.
Commercial General Liability (CGL)
An insurance policy that provides broad coverage for a business's liability exposures, primarily for claims of bodily injury and property damage to third parties arising from business operations.
- Covers bodily injury and property damage to third parties.
- Applies to premises, operations, products, and completed operations.
- Essential for most businesses to cover general liability risks.
Memory trick: General Liability covers general harm, not specific work or car alarm.