Homeowner Associations » Commercial Liability

Commercial Liability Insurance Definitions

Specific Damages (Special Damages): Injury to Third Party that requires compensation for loss of earnings and medical expenses.

General Damages: Injury to Third Party that requires compensation for pain, suffering, mental anguish, etc.

Punitive Damages: Damages to Third Party due to Gross Negligence that may require additional compensation.

Gross Negligence: Reckless disregard or intentional ignorance to duty that causes injury or damage to third party’s life or property.

Bodily Injury Liability: Legal liability arising from negligent or purposeful acts that cause injury to a third party’s person.

Property Damage Liability: Legal liability arising from negligent or purposeful acts that cause damage to a third party’s property.

Medical Payments: Coverage that provides for payment of necessary hospital bills, including medical, surgical, x-ray, dental, ambulance, etc. In most instances, these payments are automatically made regardless of fault.

Personal Injury Liability: Legal liability arising from mental injury to a third party (includes slander, false arrest, slander, invasion of privacy, etc.).

Advertising Injury Liability: Legal liability arising from misuse of advertising ideas, infringements on copyrights, mottos, slogans or titles, and violation of oral and written material.

Negligence: The failure to act in the manner that a reasonable and prudent person could be expected to act, resulting in injury or damage.

Legal Duty: The responsibility to conform to a certain standard of conduct for the protection of others.

Additional Insured: A person or entity, other then the Named Insured, who may be protected by some of the terms of the policy. The additional insured may be a spouse, member of the family, unit owner, committee member, officer, or real estate manager.

Named Insured: The person or entity named who is protected by the policy.

Binder: A form providing temporary proof of insurance pending the issuance of the actual policy. It must be in writing and is not a full contract of insurance.

Declaration Page: Usually the first page of a policy, this page provides key information detailing the coverage of the policy, including the named insured, location of property insured, effective dates of policy, limits of policy, and more.

Deductible: An amount specified in the insurance policy that the insured must pay before the policy responds to a claim.

Endorsement: This is a rider or other statement or form that is added to an insurance policy to modify the terms or conditions of the policy.

Exclusion: Specifically identifies a Cause of Loss or Property that will not be covered.

Occurrence: An incident or event that triggers coverage of an insurance policy.

Retention: See deductible.

Aggregate: The maximum limit that will be paid during a specific period of time, normally the term of the policy.

Contractual Liability: Liability arising from a breach of written or oral contract.

Hired and Non-Owned Auto: Vehicle used by insured for association business. This coverage will protect the association from suits arising from an auto involved in an accident while on an errand for the association.

Products and Completed Operations Liability: Legal Liability arising from products sold, manufactured, handled or distributed.

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