8.4 Bodily Injury, Property Damage, and Personal/Advertising Injury
Key Takeaways
- CGL Coverage A pays for bodily injury and property damage from an occurrence; Coverage B pays for listed personal and advertising injury offenses.
- Property damage requires tangible property — electronic data is not tangible, so data loss is excluded without a cyber endorsement.
- Loss of use of tangible property counts as property damage even when nothing is physically injured.
- The General Aggregate caps total annual payments and can exhaust before a per-occurrence limit is reached.
- Coverage B covers slander, libel, privacy, and copyright/trade-dress/slogan offenses but excludes patent and trademark infringement.
Bodily Injury, Property Damage, and Personal/Advertising Injury
The ISO Commercial General Liability form (CG 00 01) organizes coverage into three insuring agreements: Coverage A — Bodily Injury and Property Damage Liability; Coverage B — Personal and Advertising Injury Liability; and Coverage C — Medical Payments. Knowing exactly what each defined term includes — and excludes — is a frequent source of exam points.
Bodily Injury (BI)
Bodily injury means physical injury, sickness, or disease sustained by a person, including death resulting at any time. The exam tests two refinements:
- Mental anguish or emotional distress is covered only when it accompanies (or arises from) physical bodily injury, unless the form is endorsed to broaden it.
- BI must be caused by an occurrence — an accident, including continuous or repeated exposure to substantially the same harmful conditions — to trigger Coverage A.
Property Damage (PD)
Property damage means: (1) physical injury to tangible property, including resulting loss of use; or (2) loss of use of tangible property that is not physically injured. Two traps:
- Tangible is key — electronic data is not tangible property under the CGL, so corrupting a customer's data is not PD (a separate cyber/data endorsement is needed).
- Loss of use without physical injury still counts — e.g., a contractor blocks access to a store, causing lost business though nothing was physically damaged.
Coverage A Limits Structure
| Limit | What it caps |
|---|---|
| Each Occurrence Limit | Most paid for all BI + PD from one occurrence |
| Damage to Premises Rented to You | Fire (and limited other) damage to rented premises — e.g., $300,000 |
| Medical Expense (Coverage C) | Per-person med-pay, e.g., $5,000, no fault required |
| Products-Completed Operations Aggregate | Annual cap on products/completed-ops claims |
| General Aggregate | Annual cap on all other Coverage A and B claims |
Worked Limit Example
A CGL shows a $1,000,000 Each Occurrence Limit and a $2,000,000 General Aggregate. Three separate covered occurrences during the year produce settlements of $600,000, $800,000, and $900,000 (each within the per-occurrence cap). The insurer pays $600,000 + $800,000 = $1,400,000 on the first two, but the third is limited because only $2,000,000 − $1,400,000 = $600,000 of General Aggregate remains. The insured absorbs the remaining $300,000. This illustrates why the aggregate can exhaust before any single per-occurrence limit is reached.
Coverage B — Personal and Advertising Injury
Personal and advertising injury covers specified offenses, not accidents. The seven listed offenses are:
- False arrest, detention, or imprisonment
- Malicious prosecution
- Wrongful eviction, wrongful entry, or invasion of right of private occupancy
- Oral or written publication that slanders or libels a person or organization
- Oral or written publication that violates a person's right of privacy
- The use of another's advertising idea in your advertisement
- Infringing upon another's copyright, trade dress, or slogan in your advertisement
Because these are intentional-conduct offenses, Coverage B does not require an "occurrence" or accidental BI/PD. Note the overlap with intentional torts from Section 8.1 — several intentional torts that are excluded as BI are added back as covered Coverage B offenses.
Exam trap: Coverage B excludes injury arising from a breach of contract, knowing violation of another's rights, and statements the insured knew to be false. It also excludes patent and trademark infringement — only copyright, trade dress, and slogan are covered. Pure patent infringement is not advertising injury.
Precise ISO Definitions
Liability forms hinge on exact definitions, and exam distractors twist them:
- Bodily injury (BI): bodily injury, sickness, or disease sustained by a person, including death resulting from any of these. Note: standard CGL BI does not include purely emotional/mental distress unless accompanied by physical injury (a common test point).
- Property damage (PD): (1) physical injury to tangible property, including resulting loss of use; or (2) loss of use of tangible property that is not physically injured. Electronic data is not tangible property under the standard form.
- Occurrence: an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
Personal and Advertising Injury vs. Bodily Injury
Personal and advertising injury is a separate concept covered under CGL Coverage B and is not bodily injury. It consists of the seven named offenses — false arrest, malicious prosecution, wrongful eviction, libel/slander, invasion of privacy, use of another's advertising idea, and copyright/trade-dress/slogan infringement in an advertisement.
Worked classification: a tenant locked out improperly suffers personal injury (wrongful eviction), not bodily injury. A magazine that prints a defamatory statement causes advertising injury (libel). A customer who slips and breaks an arm suffers bodily injury. A delivery truck that crushes a fence causes property damage.
Quick Answer: Physical harm to a person = BI; physical harm/loss of use of property = PD; the seven named offenses = personal & advertising injury.
Loss of Use, Resulting Loss, and a Worked Classification
The property damage definition has two prongs the exam separates: (1) physical injury to tangible property, including the loss of use of that damaged property; and (2) loss of use of tangible property that is not physically injured. The second prong covers economic loss-of-use claims even where nothing is physically broken — for example, when a contractor blocks access to a neighboring store, causing lost business though no property is harmed.
Worked example: a delivery driver negligently knocks out a building's power line. A tenant's freezer thaws (physical injury to spoiled stock = PD prong 1) and a neighboring office cannot operate for a day (loss of use of un-damaged premises = PD prong 2). Both are property damage, though only one involves physical injury. Trap: candidates think PD always requires something to be physically broken; the second prong covers pure loss of use of intact property.
A contractor accidentally severs a fiber line, corrupting a client's stored electronic data but causing no physical damage to any object. Under the standard CGL Coverage A, this loss is:
A CGL has a $1,000,000 Each Occurrence Limit and a $2,000,000 General Aggregate. After paying $1,400,000 on two prior occurrences, a third covered occurrence settles for $900,000. How much will the insurer pay on the third occurrence?