Liability principles
Casualty = liability insurance: it covers your legal responsibility for harm to others (their bodies or property), as opposed to Property, which covers your own stuff. This is the Glacis-critical line — E&O / professional liability lives here. All STABLE.
Negligence — the heart of liability
Section titled “Negligence — the heart of liability”Most liability claims turn on negligence. To win, a claimant must prove all four elements:
- Duty — the defendant owed a legal duty of care.
- Breach — the defendant breached that duty (did, or failed to do, something a reasonable person would).
- Proximate cause — the breach was the direct cause of the harm.
- Damages — the claimant suffered actual, measurable harm.
Drop any one element and the negligence claim fails. (Memory: “Duty, Breach, Causation, Damages.”)
Defenses to negligence
Section titled “Defenses to negligence”- Contributory negligence — in a few states, if the claimant was at all at fault, they recover nothing.
- Comparative negligence — most states; the claimant’s recovery is reduced by their share of fault (pure vs modified variants).
- Assumption of risk — the claimant knowingly accepted a known danger.
Types of damages
Section titled “Types of damages”- Compensatory — make the claimant whole:
- Special (economic): medical bills, lost wages, repair costs — measurable.
- General (non-economic): pain and suffering, disfigurement.
- Punitive — punish egregious conduct; often not insurable as a matter of public policy in many states.
Flavors of liability
Section titled “Flavors of liability”- Negligence (fault-based, above).
- Absolute / strict liability — liable regardless of fault (e.g., abnormally dangerous activities, certain product defects).
- Vicarious liability — liable for another’s acts (employer for employee, within scope of employment).
Occurrence vs claims-made — the most important trigger concept
Section titled “Occurrence vs claims-made — the most important trigger concept”This decides which policy responds to a liability claim. It is the concept for E&O and the Glacis product, so learn it cold:
| Trigger | The policy that responds is the one in force when… | Used for |
|---|---|---|
| Occurrence | the event/injury happened (even if the claim comes years later). | General liability, most property/casualty. |
| Claims-made | the claim is first made, for an event after the retroactive date. | E&O, D&O, professional liability, cyber, Tech E&O. |
Claims-made policies bring two add-on concepts:
- Retroactive date — coverage only applies to wrongful acts on or after this date. Acts before it are excluded.
- Tail coverage / Extended Reporting Period (ERP) — lets you report claims after the policy ends for acts during the policy period. Essential when you switch carriers or stop coverage, so a late-arriving claim isn’t orphaned.
Full treatment: 02 E&O / professional liability and 06 Tech E&O.
Limits and the duty to defend
Section titled “Limits and the duty to defend”- Per-occurrence limit — max per single event.
- Aggregate limit — max for all claims in the policy period.
- Split limits (e.g., auto 100/300/50) vs Combined Single Limit (CSL) (one pooled limit).
- Defense costs — inside vs outside the limits: if defense is inside the limit, legal fees erode the money available to pay claims; if outside, defense is on top of the limit. (A big deal in E&O, where defense can dwarf the settlement.)
- Duty to defend — most liability policies obligate the insurer to defend the insured against covered claims, even groundless ones.
Why this is the Glacis line
Section titled “Why this is the Glacis line”The Tech-E&O-for-healthcare product is a liability/casualty coverage built on a claims-made trigger. Everything on this page — negligence, professional duty, claims-made/retroactive-date, defense-inside-limits — is the vocabulary of that product. Casualty is therefore the line Joe should target. See 03 Lines of authority.
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