Illinois Casualty Insurance State Practice Exam

What does Coverage C of a CGL Policy provide?

1. Covers legal fees for personal injury lawsuits

2. Payment for all medical expenses regardless of fault

3. Liability for damages caused by advertising errors

4. Compensation for property damage claims

The correct answer is: Payment for all medical expenses regardless of fault

Coverage C of a Commercial General Liability (CGL) Policy specifically provides medical payments coverage. This section of the policy applies to medical expenses incurred due to bodily injuries sustained by persons on the insured's premises or as a result of the insured's operations. One of the key features of Coverage C is that it pays for medical expenses regardless of fault, meaning that even if the insured is not legally liable for the injury, the medical costs can still be covered. This is distinct from other types of coverage that may have fault requirements or specific conditions under which claims can be made. Coverage C typically applies to medical expenses incurred within a specific time frame—generally within one year from the date of the accident. It is designed to encourage prompt medical treatment without the need for the injured party to take legal action against the insured, fostering goodwill and reducing the likelihood of more significant liability claims arising from injuries.