Canadian Accredited Insurance Broker (CAIB) Three Practice Exam

What type of exposure is most commonly covered by an endorsement to the Commercial General Liability Policy?

1. Automobile liability

2. Property damage liability

3. Bodily injury liability

4. Business operations liability

The correct answer is: Automobile liability

The most commonly covered type of exposure by an endorsement to the Commercial General Liability Policy is typically property damage liability. This coverage specifically addresses the liability arising from physical damage to someone else's property due to the insured's business operations, products, or premises. An endorsement may be added to enhance or modify this type of liability coverage, tailoring it to the specific needs of a business. For example, if a business regularly engages in activities that may cause damage to third-party property, an endorsement can broaden the scope of coverage or adjust limits to provide adequate protection. While bodily injury liability and other forms of liability are also important components of a Commercial General Liability Policy, the endorsement's versatility and relevance in addressing property damage scenarios makes it a crucial focus in commercial liability coverage. Understanding this can help brokers effectively assess and meet the coverage needs of their clients.