Key Takeaways
- Commercial General Liability (CGL) protects businesses from third-party claims
- Workers' compensation is required for most West Virginia employers with 3+ employees
- West Virginia has a competitive workers' comp market (private insurers and state fund)
- Professional liability covers errors and omissions in professional services
- Employers liability coverage is Part Two of workers' compensation policy
Last updated: January 2026
West Virginia Liability & Workers' Compensation Insurance
Commercial General Liability (CGL)
What CGL Covers
Commercial General Liability insurance protects businesses from third-party claims:
| Coverage | Description |
|---|---|
| Coverage A | Bodily Injury and Property Damage Liability |
| Coverage B | Personal and Advertising Injury Liability |
| Coverage C | Medical Payments |
Coverage A: Bodily Injury and Property Damage
| Aspect | Details |
|---|---|
| Bodily Injury | Physical harm to third parties |
| Property Damage | Damage to others' property |
| Legal Defense | Defense costs paid in addition to limits |
| Settlements | Judgments and settlements covered |
Examples of Covered Claims:
- Customer slips and falls in your store
- Your product injures a consumer
- Your operations damage client's property
- Completed work causes injury
Coverage B: Personal and Advertising Injury
| Offense | Description |
|---|---|
| Libel | Written defamation |
| Slander | Spoken defamation |
| False Arrest | Wrongful detention |
| Wrongful Eviction | Illegal removal from premises |
| Copyright Infringement | Advertising using others' content |
| Invasion of Privacy | Unauthorized use of name/likeness |
Coverage C: Medical Payments
| Feature | Details |
|---|---|
| Purpose | Pay medical expenses for injuries on premises |
| No-Fault | Paid regardless of negligence |
| Limit | Typically $5,000 - $10,000 per person |
| Benefit | Goodwill, avoid larger claims |
CGL Coverage Forms
| Form | Trigger | Description |
|---|---|---|
| Occurrence | When incident occurs | Most common, covers claims from policy period incidents |
| Claims-Made | When claim is made | Covers claims made during policy period |
CGL Exclusions
Standard CGL policies exclude:
| Exclusion | Rationale |
|---|---|
| Expected or Intended Injury | Not accidental |
| Contractual Liability | Limited exceptions |
| Liquor Liability | Separate coverage needed |
| Workers' Compensation | Separate coverage |
| Employer's Liability | Part of WC policy |
| Pollution | Separate environmental coverage |
| Auto | Separate auto policy |
| Professional Services | Separate E&O coverage |
West Virginia Workers' Compensation
Who Must Carry Coverage
| Employer Type | Requirement |
|---|---|
| 3+ Regular Employees | Workers' comp REQUIRED |
| 1-2 Employees | Coverage optional but recommended |
| Coal Mining | Special rules may apply |
| Construction | Required in most cases |
| Exempt Employers | Very limited exemptions |
Workers' Comp System in West Virginia
History: West Virginia previously had a state-run monopolistic fund. The market became competitive in 2006, allowing private insurers.
| Feature | Current Status |
|---|---|
| Private Insurers | Can write workers' comp |
| State Fund | BrickStreet (now Encova) exists |
| Competitive Market | Employers can choose carrier |
| Self-Insurance | Available for qualified employers |
Coverage Parts
| Part | Coverage | What It Pays |
|---|---|---|
| Part One | Workers' Compensation | Statutory benefits to injured workers |
| Part Two | Employers Liability | Third-party claims against employer |
Part One: Workers' Compensation Benefits
| Benefit Type | Description |
|---|---|
| Medical Benefits | All reasonable medical expenses |
| Temporary Total Disability | Wage replacement during recovery |
| Temporary Partial Disability | Partial wages if can work part-time |
| Permanent Partial Disability | Impairment benefits after maximum recovery |
| Permanent Total Disability | Lifetime benefits if cannot work |
| Death Benefits | Payments to dependents |
| Vocational Rehabilitation | Training for new occupation |
Benefit Calculations
| Benefit | West Virginia Formula |
|---|---|
| TTD Rate | 66 2/3% of average weekly wage |
| Maximum Weekly | State sets maximum weekly benefit |
| Waiting Period | Benefits begin after 3 days |
| Retroactive | If disability exceeds 7 days, pays from day 1 |
Part Two: Employers Liability
Covers employer against:
| Claim Type | Example |
|---|---|
| Third-Party Over | Negligent third party sues employer |
| Loss of Consortium | Spouse claims against employer |
| Dual Capacity | Employer also manufacturer of injuring product |
| Consequential Injury | Family member's derivative claim |
Typical Limits:
- $100,000 per occurrence
- $100,000 per employee
- $500,000 policy limit
Exclusive Remedy Doctrine
| Aspect | Rule |
|---|---|
| Principle | Workers' comp is exclusive remedy vs. employer |
| Benefit | Employee gets guaranteed benefits |
| Trade-off | Cannot sue employer for negligence |
| Exceptions | Intentional acts, dual capacity |
West Virginia Coal Mining Considerations
| Issue | Consideration |
|---|---|
| Black Lung | Federal coverage under Black Lung Benefits Act |
| Higher Hazards | Mining rates reflect elevated risk |
| Special Diseases | Coal workers' pneumoconiosis covered |
| Second Injury Fund | May provide additional benefits |
Professional Liability Insurance
Errors and Omissions (E&O)
| Feature | Details |
|---|---|
| What It Covers | Professional mistakes, negligence |
| Who Needs It | Insurance agents, accountants, consultants |
| Trigger | Claims-made form typical |
| Tail Coverage | Extended reporting period available |
Insurance Producer E&O
West Virginia insurance producers should carry E&O coverage:
| Coverage | Purpose |
|---|---|
| Failure to Procure | Client didn't get requested coverage |
| Misadvice | Wrong coverage recommendation |
| Administrative Errors | Policy errors, missed renewals |
| Breach of Duty | Violation of professional duties |
Common E&O Claims
| Claim Type | Example |
|---|---|
| Failure to Place Coverage | Client thought they had coverage but didn't |
| Wrong Coverage | Coverage doesn't match client needs |
| Insufficient Limits | Limits too low for exposure |
| Missed Exclusion | Didn't explain important exclusion |
| Billing Errors | Coverage lapsed due to error |
Umbrella and Excess Liability
Umbrella Liability
| Feature | Details |
|---|---|
| Purpose | Additional liability protection |
| Coverage | Over underlying policies |
| Drop-Down | May cover gaps in underlying |
| Limits | Typically $1 million to $10 million+ |
Underlying Requirements
Umbrella policies require minimum underlying limits:
| Underlying Policy | Typical Required Limit |
|---|---|
| Auto Liability | $250,000/$500,000/$100,000 |
| General Liability | $1,000,000 per occurrence |
| Employers Liability | $100,000/$100,000/$500,000 |
Excess vs. Umbrella
| Feature | Umbrella | Excess |
|---|---|---|
| Coverage | May be broader | Follows form of underlying |
| Drop-Down | Yes, for some claims | No |
| Self-Insured Retention | May have SIR | Follows underlying deductible |
Bonds and Surety
Surety Bond vs. Insurance
| Feature | Insurance | Surety Bond |
|---|---|---|
| Parties | Two (insured, insurer) | Three (principal, obligee, surety) |
| Risk | Transfer of risk | Guarantee of performance |
| Loss | Expected | Not expected |
| Recovery | Insurer absorbs loss | Principal must reimburse surety |
Common Bonds
| Bond Type | Purpose |
|---|---|
| License Bond | Guarantee compliance with regulations |
| Fidelity Bond | Protect against employee dishonesty |
| Contract Bond | Guarantee contract performance |
| Court Bond | Required for court proceedings |
Exam Tip: West Virginia requires workers' compensation insurance for employers with 3 or more employees. The market is competitive, with private insurers and the state fund available as options.
Test Your Knowledge
How many employees must a West Virginia employer have before workers' compensation is required?
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Test Your Knowledge
What type of liability insurance system does West Virginia have for workers' compensation?
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Test Your Knowledge
What does Coverage A of a Commercial General Liability (CGL) policy cover?
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