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Commercial General Liability (CGL) Insurance Claims

General liability policies are in place to protect your business from lawsuits against property damage, bodily injury, and personal and advertising injuries.  When a policyholder is sued or a claim is made against them, general liability policies are supposed to protect them from liability.

Notably, these policies are extremely broad and can cover a variety of different types of losses.  They are, however, filled with exclusions and drafted in a way that can be difficult to understand.  One Florida judge famously said, “insurance policies are prepared by experts in this complex area, and the intricate interplay of their various provisions is difficult for a layman to understand.” See New Amsterdam Cas. Co. v. Addison, 169 So. 2d 877, 881 (Fla. Dist. Ct. App. 1964).  When you have an issue under a CGL policy, you need an experienced insurance coverage attorney to help you navigate your claim. 

General liability policies have two main requirements for the insurance company: defense and indemnity.  “Defense” means that the insurance company is required to provide the policyholder with a defense against the lawsuit or claim.  This includes actually hiring and paying for a lawyer to defend the policyholder against the lawsuit.  “Indemnity” means that, if the policyholder is ever required to pay money for a claim, the insurance company will pay the money on their behalf.  CGL policies are a necessity for businesses to prevent one bad claim from destroying their business. 

Yet, although CGL policies are very broad and very common, insurance companies routinely deny coverage for a variety of different reasons.  The policy may have a certain exclusion that the insurance company points to, or it may be for a type of loss that the insurance company claims is not covered.  Whatever the reason, often times the basis for their denials is not as clear-cut as they make it seem.  You see, behind every exclusion that the insurance company claims excludes coverage is a plethora of caselaw where policyholders and insurers have litigated over the meaning of that exact exclusion.  Often times the caselaw shows that the exclusion may have a different meaning than the insurance company claims or doesn’t apply to certain facts.  In other words, denial of coverage under a CGL policy is never as elementary as the insurer makes it seem.  Don’t accept a matter-of-fact explanation from an insurance company, get an experienced insurance coverage attorney on your side. 

When your business is sued, it can become a very costly event.  If the insurance company denies coverage, you could be paying for an attorney to defend the lawsuit and be exposed to a large potential judgment.  Even if the potential judgment is small, the cost of defense itself can reach the hundreds of thousands of dollars—enough to drive even the most stable businesses under.  When a denial happens, you should have an insurance coverage attorney fighting for your rights under the policy. 

One other common scenario for insurers under CGL policies is to issue a “reservation of rights” letter.  This means that the insurance company agrees to defend you, but “reserves the rights” to later deny coverage in the future.  This often means that they will pay for your defense attorney, but when the judgment comes down you will be left to pay for it on your own, depending on how the facts come out.  Further, the reservation of rights letter may even contain a clause saying that they reserve the right seek a reimbursement from you of the fees they paid your attorney.  So after a long legal battle, you could be stuck with a huge attorney bill and a huge judgment.  Don’t let this happen to your company, when you receive an “ROR” letter, call us immediately.


The Davis Law Firm is located in Jacksonville, Florida and serves clients throughout the states of Florida and Georgia, including Jacksonville, Miami, Pensacola, Orlando, Tampa, St. Petersburg, St. Augustine, Fort Myers, Daytona Beach, Panama City, Destin, Melbourne, Fort Lauderdale, West Palm Beach, Tallahassee, the Florida Keys, and everywhere in between.



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| Phone: 904.400.1429

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