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

Coverage B: Personal and Advertising Injury Liability

Coverage B of the CGL (CG 00 01 04 13) pays damages because of personal and advertising injury (P&AI) caused by an offense arising out of the insured's business. Unlike Coverage A, Coverage B is offense-triggered, not occurrence-triggered — there need be no accident or physical contact. The harm is an intangible, reputational, or rights-based injury.

P&AI is a defined list of seven named offenses. The exam wants you to recognize them rather than the accident model used in Coverage A. Coverage B shares the General Aggregate with Coverage A, but each offense is also subject to the Personal and Advertising Injury Limit (one limit per person or organization).

The Seven Named Offenses

Memorize this list — it is the most-tested element of Coverage B:

Note that patent and trademark infringement are NOT covered — only copyright, trade dress, and slogan in your advertisement. Offenses 6 and 7 are the "advertising injury" half; offenses 1 through 5 are the "personal injury" half.

Coverage B Exclusions

Coverage B has its own exclusion list. Frequently tested exclusions:

• Knowing violation of another's rights (intentional/willful conduct).
• Material published with knowledge of its falsity (deliberate libel).
• Material first published before the policy period (a prior-publication trap).
• Criminal acts committed by the insured.
• Contractual liability assumed under contract (with limited exceptions).
• Breach of contract, except misappropriation of an advertising idea under an implied contract.
• Failure of goods to conform to advertised quality (no "warranty" coverage).
• The full pollution exclusion.

Trap: because patent/trademark are not listed offenses, claims for those are simply outside the grant, not merely excluded — there is nothing to exclude because they were never covered.

How Coverage B Differs from Coverage A

Knowing the structural contrasts helps you eliminate wrong answers quickly:

Coverage B and Coverage A both draw down the same General Aggregate, so a heavy advertising-injury year can leave less aggregate available for bodily-injury claims. The Personal and Advertising Injury Limit is a separate per-person/per-organization sublimit that caps each offense, but it can never exceed the remaining general aggregate.

Coverage C: Medical Payments

Coverage C pays 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 fault. It is a goodwill, no-fault coverage designed to settle small injuries quickly and discourage lawsuits. Because it pays without a finding of liability, the standard Medical Payments limit is small, commonly $5,000 per person.

Key features and limits:

• Pays first aid, necessary medical/surgical/dental/x-ray, ambulance, hospital, professional nursing, and funeral expenses.
• Expenses must be incurred and reported within one year of the accident date.
• Does not apply to the named insured, employees (WC), tenants, or those injured while practicing/participating in athletics.
• Subject to the Each Occurrence limit and the General Aggregate, but capped at the Medical Expense Limit Any One Person.

Worked Example: Med Pay vs. Coverage A

A visitor trips in the insured's store and incurs $4,200 in emergency-room bills. With a $5,000 Med Pay limit, the insurer pays the $4,200 with no fault inquiry under Coverage C, settling the matter quickly.

Now suppose the visitor instead sues, alleging negligence and demanding $80,000 for a fractured hip and lost wages. That liability claim moves to Coverage A, where the insurer investigates fault, defends the suit, and pays damages up to the Each Occurrence limit (e.g., $1,000,000). Med Pay amounts already paid to a claimant who later recovers under Coverage A are typically credited against the liability settlement so the insured does not pay twice.

Coverage B and Coverage C in Detail

Coverage B - Personal and Advertising Injury responds to the defined offenses rather than to accidents: false arrest or detention, malicious prosecution, wrongful eviction or invasion of a right of private occupancy, oral or written publication that libels or slanders a person or organization, publication that violates a right of privacy, the use of another's advertising idea, and infringement of copyright, trade dress, or slogan in the insured's advertisement.

Because these are intentional offenses, Coverage B has its own exclusions: it bars injury the insured caused knowing it was false, injury from a criminal act, breach of contract (except certain advertising), and intellectual-property infringement other than the listed advertising offenses. Coverage B shares the general aggregate with Coverage A.

Coverage C - Medical Payments is a small, no-fault goodwill coverage that pays reasonable medical expenses for bodily injury to a member of the public on the insured's premises or arising from the insured's operations, regardless of negligence, if the expense is incurred within a stated period (commonly one to three years). It is not liability coverage and does not pay the insured's own injuries or those of employees (workers compensation) or tenants. Its purpose is to settle minor injuries quickly and discourage lawsuits, and amounts paid are credited if the claimant later recovers under Coverage A.

The interplay is tested: a minor injury is paid promptly under Coverage C with no fault inquiry, while a serious negligence claim moves to Coverage A for investigation, defense, and damages. A defamation or advertising offense, by contrast, routes to Coverage B.

Worked scenario: a store posts an advertisement that copies a competitor's slogan and also falsely calls the competitor dishonest. The slogan copying and the false statement are Coverage B advertising-injury offenses, defended and paid subject to the general aggregate, while a customer's slip-and-fall the same day would be Coverage C (minor medical) or Coverage A (if sued). Sorting offenses into B and injuries into C or A is the core multi-coverage CGL skill.

Key Takeaways

Coverage B pays for defined personal and advertising injury offenses (false arrest, malicious prosecution, wrongful eviction, libel, slander, privacy violation, advertising-idea and copyright/trade-dress/slogan infringement) and shares the general aggregate, excluding knowingly false statements, criminal acts, and most contract and intellectual-property claims. Coverage C medical payments is a small no-fault coverage for the public's minor injuries, not for employees or the insured, and is credited against any later Coverage A recovery.