Which statement is TRUE regarding a Comprehensive General Liability policy?

Which statement is TRUE regarding a Comprehensive General Liability policy?

• A. Because it lacks flexibility, it is suitable for specialized businesses only.
• B. It can cover premises, elevators, completed operations.
• C. It must extend to cover "other hazards specified".
• D. Coverage is not as broad as the owners and contractors.

Answer: (B)

A Comprehensive General Liability policy is designed to cover common liability exposures for a business, including injuries or damage that occur on the business’s premises and risks arising from work performed. Premises coverage protects liability arising from ownership or occupancy of the insured’s premises, and elevators on those premises are part of the building’s operations, so liability arising from their use can fall under this coverage. Completed operations protection covers claims that arise after a project is finished if the completed work later causes injury or damage. So, stating that a CGL can cover premises, elevators, and completed operations reflects how this policy addresses everyday business risks. The other statements mischaracterize the policy: it isn’t inherently inflexible or limited to specialized businesses; endorsements can tailor coverage and many businesses use it effectively. Coverage for “other hazards specified” isn’t a required extension—additional hazards are typically added via endorsements, not a default rule. And whether a CGL is broader or narrower than an owners and contractors policy depends on the specific forms and endorsements in use; the general idea isn’t a fixed comparison.

A Comprehensive General Liability policy is designed to cover common liability exposures for a business, including injuries or damage that occur on the business’s premises and risks arising from work performed. Premises coverage protects liability arising from ownership or occupancy of the insured’s premises, and elevators on those premises are part of the building’s operations, so liability arising from their use can fall under this coverage. Completed operations protection covers claims that arise after a project is finished if the completed work later causes injury or damage. So, stating that a CGL can cover premises, elevators, and completed operations reflects how this policy addresses everyday business risks.

The other statements mischaracterize the policy: it isn’t inherently inflexible or limited to specialized businesses; endorsements can tailor coverage and many businesses use it effectively. Coverage for “other hazards specified” isn’t a required extension—additional hazards are typically added via endorsements, not a default rule. And whether a CGL is broader or narrower than an owners and contractors policy depends on the specific forms and endorsements in use; the general idea isn’t a fixed comparison.