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Insurance · Commercial General Liability

What does Commercial General Liability (CGL) insurance protect a business against?

Reviewed by Jordan Morley, Editorial Lead at 247SimpleTests. Written by the 247SimpleTests Editorial Team from the official source material cited on every question.

Correct answer

Third-party claims for bodily injury, property damage, and personal/advertising injury arising from the business's operations, premises, or products

  1. A Employee injuries on the job
  2. B Damage to the business's own building only
  3. C The business's lost income
  4. D Third-party claims for bodily injury, property damage, and personal/advertising injury arising from the business's operations, premises, or products

Why this is the answer

Commercial General Liability (CGL) insurance protects a business against third-party claims for bodily injury and property damage arising from its premises, operations, products, and completed work, as well as 'personal and advertising injury' (such as libel, slander, or certain advertising-related offenses). It pays damages the business is legally obligated to pay and the cost of defense, up to policy limits. CGL does not cover the business's own property (commercial property insurance), employee injuries (workers compensation), or professional errors (professional liability). Understanding the broad third-party liability protection CGL provides is core general-liability content on the casualty exam.
Source: NAIC Model Outline, CGL

Practice more questions

This question is from our Insurance License Practice Tests practice test. Take the full practice test to test your knowledge across all Commercial General Liability and other topics.

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About this topic: Commercial General Liability

Commercial general liability questions cover bodily injury and property damage liability, personal and advertising injury, medical payments, occurrence versus claims-made forms, and the standard exclusions. This is one of 13 Casualty Insurance questions on commercial general liability, each with a full explanation on a single study page.

New to this exam? Our Insurance exam guide explains the format, scoring, and how to prepare.

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