OLT-Breakroom: Unit 7 Quiz - Question 9

An insured is a restaurant operator who carries a Commercial General Liability policy. The insured's premises include a parking area used for valet parking of customer's cars. An employee of the insured, while parking a customer's automobile, hit another automobile in the parking lot. In addition to damaging to the automobile, a customer was injured while standing beside the damaged automobile. Which of the following describes how the insurer will respond?

A. Will pay damage to customer's automobile

B. Will pay nothing

C. Will pay injuries to injured customer

D. Will pay for injury to customer and damage to customer's automobile

The answer is C. I assume because the restaurant is in the business of parking cars they are going to need a commerical auto policy. However, in the CGL, BI and PD exclusions for "Aircraft, Autos, Watercraft" state that there is coverage for "parking of others autos on or next to the insured's premises." How does this not apply to the scenario in the question above?

Re: Unit 7 Quiz - Question 9

by Deleted user - Wednesday, 16 October 2013, 2:55 PM

I'm bumping this because I'm still curious.

Re: Unit 7 Quiz - Question 9

by Jan Bradburn- - Wednesday, 16 October 2013, 5:41 PM

Travis

I apologize for missing your question earlier. Thanks for reposting.

A CGL covers liability for BI and PD business risks. In this case there is only coverage for the injured customer under the CGL because the damage to the auto would be covered under Garagekeepers insurance in the Business Auto Policy. This is because a CGL does not cover (nonowned) vehicles in the care, custody and control of the insured. CCC coverage or Bailee coverage is only available for vehicles in Garagekeepers Insurance which covers the risk of the" business" of parking cars.

I hope this helps.

Jan