Commercial general liability (“CGL”) policies are a norm in the UAE. A CGL policy usually provides comprehensive liability coverage by encompassing different liability coverage under the same head, such a property coverage, personal injury coverage, medical coverage etc. A CGL policy thus endeavors to cover the various liabilities arising from operations, premises, products of a business under one policy.

The broadheads covered under a commercial liability policy in the UAE includes:

A key difference between different types of CGL policy is the concept of how claims can be raised. For example, a “claim-based policy” allows for claims to be raised during the policy terms regardless of when the underlying claim event occurred. However, on the other hand, a “occurrence policy” strictly goes by the concept of when the claim event occurred and stipulates to honour the claim only if the underlying claim event occurred during the policy term. It is usually seen that CGL policies in the UAE are mostly occurrence-based policies.

It is important to note that, even though the CGL policy constitutes a very comprehensive policy, it might still not cover all the risks and liabilities connected to a business. It is therefore advisable to conduct a detailed study to ensure that commercial liabilities unique to the business are identified and covered. Suppose the standard CGL policy is seen to lack in its liability coverage. In that case, ‘excess liability coverage’ can be purchased in addition to cover the claims that either exceeds the limit or are not part of the standard CGL policy. For example, a standard CGL policy may exclude from its purview the commercial liability coverage for product recalls or computer-related losses etc. A medical payment coverage may also be added into a CGL policy in order to cover third-party bodily injuries at a higher limit, regardless of the business’s liability or negligence in the incident.