CIC U6 PRACTICE EXAM
Question 1: A warehouse employee is injured by a pallet jack while performing
assigned job duties and brings a bodily injury claim against the employer. Under an unendorsed CGL policy, which exclusion most directly addresses this claim?
Choices:
1) Damage to property exclusion 2) Aircraft, auto, or watercraft exclusion 3) Employers liability exclusion 4) Personal and advertising injury exclusion
Correct Answer: Employers liability exclusion
Explanation: The CGL employers liability exclusion addresses bodily injury to an employee arising out of and in the course of employment. Work-related employee injuries are primarily addressed through workers compensation and, when applicable, employers liability coverage rather than ordinary CGL Coverage A.Page 1
Question 2: A retailer publishes an advertisement that falsely disparages a
competitor's products, and the competitor sues. Which CGL coverage is most directly designed to respond, assuming no exclusion applies?
Choices:
1) Coverage A - Bodily Injury and Property Damage Liability 2) Coverage B - Personal and Advertising Injury Liability 3) Coverage C - Medical Payments 4) Damage To Premises Rented To You
Correct Answer: Coverage B - Personal and Advertising Injury Liability
Explanation: Coverage B addresses de�ned personal and advertising injury o�enses, including certain publications that libel, slander, or disparage a person or organization or its goods, products, or services.
Question 3: A subcontractor signs a written agreement assuming a general
contractor's tort liability for bodily injury to third parties arising from the subcontractor's work. If the agreement quali�es as an insured contract, how does the CGL contractual liability exclusion generally treat the assumed liability?
Choices:
1) It is always excluded because all assumed liability is uninsurable 2) It is covered only by Coverage C 3) It is covered only if the injured party is an employee of the subcontractor 4) It may fall within an exception to the contractual liability exclusion, subject to the policy terms and limits Correct Answer: It may fall within an exception to the contractual liability exclusion, subject to the policy terms and limits Page 2
Explanation: The CGL contractual liability exclusion contains exceptions, including liability assumed in an insured contract. When the agreement meets the insured-contract de�nition, the assumed tort liability may be covered subject to all other policy provisions and limits.
Question 4: A CGL policy has a $2,000,000 General Aggregate Limit and a
$1,000,000 Each Occurrence Limit. Two covered non-products occurrences have already resulted in payments of $900,000 and $750,000. A third covered non- products occurrence produces $600,000 of covered damages. Ignoring deductibles and other limits, what is the most the policy can pay for the third occurrence?
Choices:
1) $350,000
2) $600,000
3) $250,000
4) $1,000,000
Correct Answer: $350,000
Explanation: The �rst two payments use $1,650,000 of the $2,000,000 General Aggregate Limit, leaving $350,000. Although the third loss is below the $1,000,000 Each Occurrence Limit, the remaining aggregate caps payment at $350,000.
Question 5: A U.S. manufacturer sells a product made in the United States. A
customer is injured by that product while traveling in Spain and later �les suit Page 3