10.2 CGL Coverage B: Personal and Advertising Injury, Coverage C: Medical Payments
Key Takeaways
- Coverage B pays for Personal and Advertising Injury arising from seven named offenses (false arrest, malicious prosecution, wrongful eviction, libel/slander, invasion of privacy, use of another's advertising idea, infringing copyright/trade dress/slogan) — NOT patent infringement.
- Coverage B does not require an occurrence; it is subject to the Personal and Advertising Injury Limit and erodes the General Aggregate, not the Each Occurrence Limit.
- Coverage C Medical Payments is a no-fault, goodwill coverage paying BI medical expenses regardless of liability, within a per-person sublimit (commonly $5,000-$10,000).
- Coverage C requires expenses to be incurred and reported within one year and excludes any insured, employees, tenants of leased premises, and athletic participants.
- All three grants have separate triggers: Coverage A needs an occurrence, Coverage B needs a named offense, Coverage C needs an accident — and only A and C share the Each Occurrence Limit.
Coverage B: Personal and Advertising Injury Liability
Coverage B is the non-bodily-injury liability grant. It pays damages the insured is legally obligated to pay because of personal and advertising injury — offenses arising out of the insured's business. Unlike Coverage A, Coverage B does not require an occurrence (accident); it responds to a closed list of named intentional-conduct offenses committed without intent to injure.
The Seven Named Offenses
Personal and advertising injury means injury, including consequential bodily injury, arising out of one or more of these offenses:
- False arrest, detention, or imprisonment
- Malicious prosecution
- Wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room/dwelling/premises
- Oral or written publication of material that slanders or libels a person or organization, or disparages goods/products/services
- Oral or written publication of material that violates a person's right of privacy
- The use of another's advertising idea in the insured's advertisement
- Infringing on copyright, trade dress, or slogan in the insured's advertisement
Coverage B Exclusions and Limits
Coverage B carries its own exclusions that frequently appear on exams:
- Knowing violation of another's rights, and material published with knowledge of its falsity
- Material first published before the policy period
- Breach of contract (except for an implied contract to use another's advertising idea)
- Patent infringement — note Coverage B covers copyright, trade dress, and slogan, but NOT patents
Coverage B is subject to the Personal and Advertising Injury Limit (a per-person/per-organization limit) and erodes the General Aggregate. It is not capped by the Each Occurrence Limit, which applies only to Coverage A and Coverage C.
Coverage C: Medical Payments
Coverage C is a no-fault, goodwill coverage. It pays reasonable medical expenses for bodily injury caused by an accident on the insured's premises, on ways next to the premises, or because of the insured's operations — regardless of fault. Its purpose is to settle minor injuries quickly and discourage lawsuits.
Key conditions:
- The accident must take place in the coverage territory and during the policy period.
- Expenses must be incurred and reported within one year of the accident date.
- The injured person must submit to examination by the insurer's chosen physicians as often as reasonably required.
Who Coverage C Excludes
Medical Payments does not apply to:
- Any insured (other than a volunteer worker)
- A person hired to do work for the insured
- A person injured on that part of premises the insured rents/leases to that person
- An athletic-activity participant
- Anyone whose injury is also covered under Coverage A for the insured
Coverage C is subscribed by the Medical Expense Limit (a single per-person sublimit, commonly $5,000 or $10,000) and erodes the Each Occurrence Limit and General Aggregate.
Worked Example: Three Coverages, One Loss
A visitor slips in the insured's store, breaking a wrist. The store offers to pay the visitor's $4,000 emergency-room bill immediately, without any finding of fault — this is Coverage C Medical Payments (within a $5,000 sublimit).
Later, the visitor sues, alleging the floor was negligently mopped, and wins $80,000 in damages. That award is Coverage A BI (caused by an occurrence), subject to the Each Occurrence Limit. If the same store had also published a false ad claiming a competitor's products were defective, any resulting damages would fall under Coverage B. Each grant has a distinct trigger and limit.
An insured's online advertisement copies a rival's distinctive slogan. The rival sues for damages. Which CGL coverage responds?
A customer trips on the insured's premises and the insured wants to pay the $2,000 hospital bill promptly without litigating fault. Which statement about Coverage C is correct?
Why Coverage B and C Round Out the CGL
Coverage B (Personal and Advertising Injury) is the deliberate carve-back to the policy's expected-or-intended bar, covering a closed list of named offenses: false arrest/detention/imprisonment, malicious prosecution, wrongful eviction/entry/invasion of privacy of a room or premises, oral or written publication that libels or slanders, publication that violates a right of privacy, use of another's advertising idea, and infringement of copyright/trade dress/slogan in your advertisement.
| Coverage | Fault basis | Limit that caps it |
|---|---|---|
| A | Legal liability for BI/PD | Each Occurrence / aggregates |
| B | Liability for named offenses | Personal & Advertising Injury limit |
| C | No-fault medical payments | Medical Expense limit (e.g., $5,000) |
Exam traps: Patent and trademark infringement are excluded from Coverage B — only copyright, trade dress, and slogan in your advertisement are covered. Coverage C pays small medical bills without regard to fault to head off larger Coverage A suits, but it excludes the insured, the insured's employees (workers comp responds), tenants, and anyone injured off the premises by operations not in progress.
Applying B and C to a Single Loss
Because the three CGL coverages can respond to one event, the exam often presents a layered fact pattern and asks which coverage pays which piece.
Worked example: A store manager wrongly accuses a customer of shoplifting in front of others (defamation), has a guard detain him (false imprisonment), and the customer trips on a torn mat during the detention, cutting his hand.
- The defamation and false imprisonment are named offenses under Coverage B — paid up to the Personal & Advertising Injury limit.
- The cut hand is bodily injury; the store may offer Coverage C medical payments (no-fault, small limit) to defuse it, and if the customer sues for negligence, Coverage A responds to the BI up to the each-occurrence limit.
Key distinctions to carry into the exam: Coverage B is liability coverage (the insured must be legally responsible for a named offense), while Coverage C is a goodwill, no-fault medical payment that does not require liability and is intended to prevent a Coverage A claim. Coverage B does not cover offenses committed with knowledge of falsity (knowingly false defamation), breach of contract, failure to conform to advertised quality, or the insured's own media/advertising business — all common wrong answers.