8.4 Bodily Injury, Property Damage, and Personal/Advertising Injury

Coverage A: Bodily Injury and Property Damage

The ISO Commercial General Liability (CGL, CG 00 01) Coverage A insuring agreement pays sums the insured becomes legally obligated to pay as damages because of bodily injury or property damage caused by an occurrence.

• Occurrence is defined as an accident, including continuous or repeated exposure to substantially the same harmful conditions.
• Coverage A also provides the duty to defend, and defense costs are paid in addition to the limit of insurance until the limit is exhausted by payment of judgments or settlements.

Defining Bodily Injury and Property Damage

Bodily Injury (BI)

Bodily injury means physical injury, sickness, or disease sustained by a person, including death that results from any of these at any time. Purely emotional or economic harm, standing alone, is generally not bodily injury under the standard CGL definition.

Property Damage (PD)

Property damage has two prongs:

1. Physical injury to tangible property, including resulting loss of use; and
2. Loss of use of tangible property that is not physically injured.

Exam trap: Electronic data is not tangible property under the standard CGL, so corrupted data alone is usually not property damage.

Coverage B: Personal and Advertising Injury

Coverage B responds to personal and advertising injury arising out of a listed offense — not an accident. The trigger is the commission of the offense during the policy period. The covered offenses include:

• False arrest, detention, or imprisonment
• Malicious prosecution
• Wrongful eviction, wrongful entry, or invasion of the right of private occupancy
• Libel (written defamation) and slander (spoken defamation)
• Oral or written publication that violates a person's right of privacy
• The use of another's advertising idea in the insured's advertisement
• Copyright, trade dress, or slogan infringement in the insured's advertisement

Exam trap: Patent and trademark infringement are not covered under Coverage B; only copyright, trade dress, and slogan in advertising are listed.

Comparing the Two Coverages

Both coverages share the General Aggregate Limit, but the Personal and Advertising Injury Limit caps Coverage B per person or organization.

Loss of Use and the Impaired Property Limitation

The second prong of property damage — loss of use of tangible property that is not physically injured — frequently appears in products and completed-operations claims.

Example: A defective component is installed in a machine; the machine is not physically harmed but must be shut down. The downtime is a loss of use, and the timing of that loss of use is the date the property damage is deemed to occur.

The standard CGL impaired property exclusion limits coverage when the only damage is to the insured's own product or work that can be restored by repair or replacement, steering such losses toward warranty rather than insurance.

The Offense Trigger and the Knowing-Violation Bar

Coverage B turns on the commission of a listed offense during the policy period, not on an accident. This distinction explains several common denials.

• Personal and advertising injury caused by the insured with knowledge that the act would violate another's rights is excluded (the knowing-violation exclusion).
• Material the insured knew was false when published is also excluded, so a deliberately false advertisement is not a covered slander or disparagement.

Exam trap: Coverage B is not a blanket defamation shield; deliberate, knowing wrongdoing falls outside it because liability insurance covers unintentional, not willful, conduct.

Putting BI, PD, and PAI in Context

Every commercial liability question reduces to one decision: which injury definition fits, and therefore which coverage answers.

• A customer breaks an arm slipping on a spill -> bodily injury, Coverage A.
• A delivery truck backs into a client's fence -> property damage, Coverage A.
• The insured's brochure copies a rival's slogan -> advertising injury, Coverage B.
• The insured's manager wrongly locks a guest in a room -> personal injury (false detention), Coverage B.

Matching the facts to the precise defined term is the single most repeated skill the Property and Casualty exam tests across the entire liability section.

Limits That Govern These Coverages

The CGL caps each injury type through a structured limit schedule. Bodily injury and property damage under Coverage A erode the General Aggregate, while products-completed operations claims erode a separate Products-Completed Operations Aggregate.

Example: With a $1,000,000 Each Occurrence limit and a $2,000,000 General Aggregate, a single $1,200,000 slip-and-fall is capped at $1,000,000, and that payment also reduces the $2,000,000 aggregate to $1,000,000 for the rest of the term.