DC DC Commercial Insurance 1 — Questions and Answers
Question 1: In the District of Columbia, a Business Owners Policy (BOP) typically combines which two key coverages?
- Commercial auto and workers' compensation
- Commercial property and commercial general liability (Correct answer)
- Professional liability and cyber liability
- Directors and officers liability and employment practices liability
Correct answer: Commercial property and commercial general liability
A BOP bundles commercial property insurance and commercial general liability (CGL) into a single, cost-effective policy for small to midsize businesses.
Question 2: Which DC commercial insurance policy protects a business against claims of bodily injury or property damage caused by its operations, products, or completed work?
- Commercial property insurance
- Commercial general liability (CGL) insurance (Correct answer)
- Commercial auto insurance
- Inland marine insurance
Correct answer: Commercial general liability (CGL) insurance
Commercial general liability insurance covers third-party claims for bodily injury and property damage arising from business operations, products, and completed work.
Question 3: A DC restaurant's liquor liability policy would respond to claims arising from:
- Fire damage to the restaurant's kitchen equipment
- Injuries caused by an intoxicated patron served at the restaurant (Correct answer)
- Employee theft of cash from the register
- A slip-and-fall in the restaurant parking lot
Correct answer: Injuries caused by an intoxicated patron served at the restaurant
Liquor liability (dram shop) coverage pays for claims resulting from bodily injury or property damage caused by an intoxicated person who was served alcohol by the insured.
Question 4: What does a DC commercial umbrella policy primarily provide?
- First-dollar coverage before other policies respond
- Excess liability coverage above the limits of underlying policies (Correct answer)
- Replacement cost coverage for commercial buildings
- Coverage for employees injured on the job
Correct answer: Excess liability coverage above the limits of underlying policies
A commercial umbrella policy provides an extra layer of liability coverage that kicks in once the limits of underlying policies are exhausted.
Question 5: A DC technology firm wants coverage for losses from a data breach exposing customer records. Which policy should it purchase?
- Commercial property insurance
- Cyber liability insurance (Correct answer)
- Professional liability insurance
- Commercial crime insurance
Correct answer: Cyber liability insurance
Cyber liability insurance covers costs associated with data breaches, including notification, credit monitoring, legal defense, and regulatory fines.
Question 6: Under a DC commercial general liability policy, the 'occurrence' trigger means coverage applies when:
- A claim is first made during the policy period
- The bodily injury or property damage occurs during the policy period, regardless of when the claim is filed (Correct answer)
- The insured reports the incident to the insurer during the policy period
- The lawsuit is filed during the policy period
Correct answer: The bodily injury or property damage occurs during the policy period, regardless of when the claim is filed
An occurrence-based CGL policy covers incidents that happen during the policy period even if the resulting claim is filed years later.
DC DC Commercial Insurance 1
In the District of Columbia, a Business Owners Policy (BOP) typically combines which two key coverages?