What is Not Covered

What is covered under your liability policy is a function of the substantive state law of your state. One state's courts may rule that a liability policy covers a particular occurrence, while a neighboring state rules it does not. There are some types of occurrences that are not covered and are excluded from the definition of occurrence across all liability policies:

Injury to a Worker- Workers are covered by workers’ compensation insurance and workers are not “third-parties” and, therefore, worker injury is not covered.

Automobile Liability – Damage or loss caused by a company vehicle is covered by a commercial auto policy specifically sold separately from the liability policy.

Damage to Business Property – Damage to business property or location is covered by your property and casualty insurance and your business is the “first-party” and liability coverage only applies to third-party claims.

Pollution – Most liability policies do not cover pollution. If your business will or can harm the environment, then you will need a separate policy or a pollution endorsement.

Products Completed Coverage – Liability policies do cover loss or damage caused by a completed product or service in most cases as long as there is a products-completed operations clause in the policy. Liability policies do not cover loss or damage due to the costs associated with the removal of a product or a recall of the product. There is separate coverage for that situation called product withdrawal coverage.