SubjectCommercial Third Party LiabilitySarajewo19.02.1998
WordingThe Company agrees subjectto the terms, exclusions andconditions contained hereinto indemnify the Insuredagainst all sums which theInsured shall become legallyliable to pay asdamages……...
Legal LiabilityLegal Liability• Written lawCommon law• Germany, France USA ,UK• Law developed by thecourts within a legal system
LegalLiabilityLawof ContractOverlapLawof tort+= LegalLiability
Commercial Third PartyLiabilityCommercial liability insurance can bedivided up into three areas of risk‣ the public liability risk‣ the products liability risk‣ the pollution liability risk
Commercial liability riskPublic liability riskProducts liability riskPollution liability risk
Public LiabilityPublic Liability Risk‣ The Public Liability risk is understood to meanthe legal liability which can arise as a result ofthe operation of a business and which has its originon the business premises or is incurred when thebusiness activity is beeing performed elsewhere.
Public Liability Risk•the operating site(s) and the building situatedon them, including all land and buildings orpremises used for the business activities•for examplefactory sites, salesrooms, offices,storage areas for materials, products, waste•any branch offices (including ones abroad)•participation in exhibitions, fairs•assembly work carried out off the premises
Public Liability risk•all business equipment such as:machinery, tools, vehicles, tanks and fuelstorage depots, social facilities such as canteenskindergarden, safety arrangement such as firebrigade, first aid posts with doctors, advertisinginstallations, animals used for the business(guard dogs), railways within the company site•all stuff, the owners, executives, white-collarand blue-collar workers, working for thebusiness
WordingStandard Exclusions inInternational LiabilityPolicies‣Bodily injury sustained by an employee arising out of and incourse of his or her employment (a.)(Employer´s Liability Policy)‣Any contract or agreement whether written verbal or impliedunless such liability would have attached nonwithstandingany such contract or agreement. (b.)‣Motor vehicles for which compulsory insurance is requiredAircraftWatercraft (e.)
WordingStandard Exclusions inInternational LiabilityPolicies‣ Losses caused by seepage pollution orcontamination (g.)‣ Nuclear damages I.)‣ Damage to property in the Insured’s care,custody orcontrol (n.)
Schedule............................................... Co. Ltd.Product Liability and Public Liability PolicySchedule to the PolicyInsured Nam e: __________________ Policy No. _______A ddress: __________________Description of the Risk: __________________________Territorial Lim it:Policy Period:lim it of Indem nity:Public Liability _________Product Liability ________ (Products m ade in ........0nly)From __________________________to _____________________________A ny one occurrence _____________________________Aggregate during thePolicy period for productsDeductible % ____m ax.________________________A nnual Prem ium : ______________________________________A ddress of Policy Issuing Office:______________________________________________________________________________
WordingTypes of damages covered bya Third Party Liability Policy‣ Bodily Injury‣ Property Damage
WordingDefinition ofProductThe word “Products” wherever used inthis policy shall mean anything soldsupplied, altered, constructed, manufactured,repaired, serviced, designed,tested, installed orprocessed by or on behalf of the Insured and which isnot in the possession of the Insured at thetime of the occurrence/accident.
Products LiabilityDefinition ofthe Products Liability riskIt is the legal liability which can arise as a resultof products having been incorrectly designed and/or constructed/manufactured and causing damagebecause a defect after they have left theentrepreneur’s sphere of influence
Pruducts LiabilityWhat is a fault in design ?If a mistake is made during a product´splanning or conception, this is knownas a “fault in design”.
Pruducts LiabilityWhat is a fault in instruction?If the manufacturer or seller gives incorrectinformation about a product or its use andthis results in a loss without the product itselfbeing defective, then this is a case of “faultin instruction”.
Products LiabilitySpecial ExclusionsinProducts Liability‣damage to the product itself and/or anycosts incurred to replace components orthe the whole defective product‣products for use in aircraft‣nuclear products‣losses caused by products whose salehas been prohibited by the government
Next StepsInformation about products risks‣ the production programme‣ the quantities produced‣ how long the products have beenmanufactured‣ where the products are supplied to‣ what quality control arragements are there forthe products‣ etc.
Products LiabilityThe Pollution liability riskThe pollution risk is understood tomean the responsibility for a lossarising from business operations andcausing impairment of theenvironment
Products LiabilityDefinition of pollution liability riskPollution liability is the obligation to indemnifya loss which arises through noxious substancesor noise altering or contaminating air, water orground, or otherwise impairing the environment.The substances may be liquids, vapours, smoke,gases or any other conceivable matter
Such cover does not includethe following !‣ pollution damage occurring gradually‣ nuclear damage‣ losses arising as a result of the Insured’sknowingly departing from statutoryregulations or ordinances
Questionnaire about pollution liability risks‣ situation of the risk‣ surrounding area‣ storage of noxious substances‣ fuel storage depots‣ pipelines‣ storage of waste‣ etc.
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