Safe Solutions

Commercial general liability policy review

Recently, Insurance Services Office (ISO) Form CG 00 01 12 04, which contains standardized insurance policy language many insurers include in their policies, has undergone significant changes to its commercial general liability (CGL) definitions of "mobile equipment" and "auto." Because these changes could have negative implications for your company if you don't have CGL and commercial auto coverage with a single carrier, you should consider reviewing your CGL policy to see whether it contains ISO Form CG 00 01 12 04.

New definitions

ISO's CGL definition of mobile equipment now includes a paragraph stating the term "mobile equipment" no longer applies to vehicles that are subject to compulsory or financial responsibility laws or other motor vehicle insurance laws. For roofing contractors, mobile equipment might include extensible boom lifts and fork lifts. (However, job-site operation of such equipment would be covered by your CGL policy for bodily injury and property.)

Before this change was made, the distinction between autos (vehicles designed for travel on public roads) and mobile equipment (vehicles principally designed for use off public roads) sometimes fell into a gray area of coverage. Now, mobile equipment could fall under the auto definition if that equipment is subject to a compulsory or financial responsibility law.