Standard Commercial General Liability Insurance Policies generally protect businesses against third-party claims for property damage or bodily injury resulting from an occurrence, which can include exposures to harmful conditions. These policies are triggered by an occurrence which is generally understood to include an accidental or fortuitous event. It can be anticipated that a policyholder may claim that a company’s failure to take to certain precautions to prevent the transmission of the Coronavirus at its place of business constitutes an accidental event that lead to bodily injury. Likewise, a policyholder may claim that a company’s shipment of product that contained the Coronavirus that lead to a third party’s injury constitutes an accident. In addition to the dispute as to whether the event giving rise to a claim against a business constitutes an “occurrence,” the CGL coverage will likely be subject to the same policy exclusions discussed in the business interruption section.
In light of various directives from government agencies, many restaurants have been closed for service with the exception of take-out or delivery options. One risk posed to restaurant owners is whether delivery services would be covered under their Commercial General Liability Policy. Generally, Commercial General Liability Policies exclude coverage for liabilities arising out of the operation of a motor vehicle. However, coverage may be available if the policy also provides business auto coverage. Any claim under a business auto coverage form must include an analysis of the vehicles covered. Additionally, while an employee may be using his or her personal vehicle to deliver the restaurant’s food, the employee’s personal auto policy may preclude coverage for liabilities while the employee is working in the business of an employer. Scrutiny of a business owner’s business liability policy should be undertaken to ascertain whether the risks presented by the Coronavirus pandemic are appropriately protected.
Finally, most Commercial General Liability Policies incorporate an express EPL Exclusion for employment-related practices, policies, acts, or omissions, such as discipline, defamation, harassment, or discrimination initially could impact any employment related claim under a CGL policy.