10.2 CGL Coverage B: Personal and Advertising Injury, Coverage C: Medical Payments

Coverage B: Personal and Advertising Injury Liability

Coverage B of CG 00 01 04 13 protects the insured against liability for personal and advertising injury — non-physical harms to reputation, privacy, and intellectual/advertising rights. Unlike Coverage A, no bodily injury, property damage, or occurrence is required. Coverage B responds when the insured commits one of seven enumerated offenses in the course of the business, and the insurer also has the duty to defend suits alleging such offenses.

The Seven Enumerated Offenses

Trap: Coverage B's intellectual-property reach is narrow. It covers copyright, trade dress, and slogan infringement in an advertisement only. Broad patent and trademark infringement are excluded — a frequent distractor on the exam.

Coverage B Limit and Key Exclusions

Coverage B is subject to its own Personal and Advertising Injury Limit, a per-person/organization limit that also feeds the General Aggregate. Notable exclusions include injury caused by the insured with knowledge of its falsity, breach of contract, the failure of goods to conform to advertised quality, wrong description of prices, and offenses by businesses in advertising, broadcasting, publishing, or telecasting (those need a media/E&O policy).

Coverage C: Medical Payments

Coverage C is a small, no-fault grant that pays reasonable medical expenses for bodily injury caused by an accident on premises the insured owns or rents, or arising out of the insured's operations — regardless of whether the insured is legally liable. This goodwill coverage heads off larger lawsuits by paying minor injuries quickly.

No-fault vs. legal liability: This is the most-tested contrast in the section. Coverage A pays only when the insured is legally obligated; Coverage C ignores fault and pays a capped medical amount to keep small injuries from escalating.

Coverage B: Personal and Advertising Injury

Coverage B insures personal and advertising injury — a defined list of offenses rather than accidental BI/PD.

The covered offenses are: false arrest, detention, or imprisonment; malicious prosecution; wrongful eviction, wrongful entry, or invasion of the right of private occupancy; oral or written publication of material that slanders or libels a person or organization or disparages its goods/services; publication of material that violates a person's right of privacy; the use of another's advertising idea in the insured's advertisement; and infringement of copyright, trade dress, or slogan in the insured's advertisement.

Because these are intentional-act offenses, the trigger is commission of the offense during the policy period, not an "occurrence." Coverage B has its own limit and is subject to the General Aggregate, and like Coverage A, defense costs are outside the limit. Notable exclusions include knowing falsehood, criminal acts, breach of contract, and offenses by businesses in the advertising, broadcasting, or publishing business themselves.

Coverage C: Medical Payments

Coverage C (Medical Payments) pays reasonable medical expenses for bodily injury caused by an accident on premises the insured owns or rents or because of the insured's operations, regardless of fault — a goodwill, no-fault coverage that can defuse claims before they become liability suits. Expenses must be incurred and reported within a stated period (commonly one year of the accident date), and the limit is a low per-person amount.

Coverage C excludes payment to the named insured, employees (covered by workers' comp), tenants, persons injured on that part of premises the insured rents to others, and injuries arising from products-completed operations or war. A practical exam point: because Coverage C pays without regard to fault and is separate from Coverage A liability, an insurer may pay a small medical-payments claim to avoid a larger negligence suit — but it does not admit liability by doing so. Distinguishing Coverage B's offense-based trigger from Coverage C's no-fault, on-premises medical coverage is the central exam contrast.

Who Coverage C Does NOT Pay

Medical Payments excludes several persons even though they are injured on the premises:

• The named insured, partners, members, and their employees (employees use workers' compensation).
• A tenant injured in premises rented to that tenant.
• Any person injured while taking part in athletic activities sponsored by the insured.
• Any person whose injury is covered by workers' compensation, disability benefits, or similar law.
• Persons injured by the products-completed operations hazard (that belongs under Coverage A).

How Each Coverage Interacts With the Limits

Worked example: Suppose a policy has a $1,000,000 Each Occurrence Limit, a $5,000 Medical Expense Limit, and a $2,000,000 General Aggregate. A single accident produces a $4,000 Coverage C payment plus a $300,000 Coverage A bodily-injury judgment. The total $304,000 fits within the $1,000,000 occurrence limit, and the full $304,000 reduces the $2,000,000 General Aggregate to $1,696,000 of remaining coverage for the rest of the policy year.

Quick Distinctions to Memorize

• Coverage B needs an offense, not an occurrence; Coverage A needs an occurrence.
• Coverage B covers slogan, copyright, and trade-dress in advertising — not patents or general trademarks.
• Coverage C is no-fault and capped; Coverage A is liability-based and limited only by the Each Occurrence Limit.