Coverage Territory of the CGL Form

Q

We know that the definition of coverage territory has been revised in the new CGL forms. Does the revision extend the territory with respect to completed operations? The CGL used to define coverage territory as applying to all parts of the world “if the injury or damage arises out of goods or products made or sold” by the named insured. Does the new definition now include completed operations?

Also, how are Internet claims handled since the Internet is a worldwide force? If a claim is made against my insured, who is domiciled in Delaware, because of his use of the Internet in Germany , will the CGL form provide the insured coverage and defense costs?

Delaware Subscriber

A

The coverage territory under the CGL form does not extend to a worldwide basis with respect to completed operations. The current CGL form does extend worldwide coverage for the products exposures of the insured under certain circumstances, but completed operations do not have this worldwide scope.

As for Internet exposures, the current CGL form notes that the coverage territory is all parts of the world for “personal and advertising injury offenses that take place through the Internet or similar electronic means of communications.” So, for example, if your insured slanders a competitor over the Internet in Germany , and the injured party sues, the insured's CGL form will provide coverage for the insured. Of course, the insured's responsibility to pay damages has to be determined in a lawsuit filed in the United States, Puerto Rico, or Canada, but the fact that the offense occurred in Germany will not automatically exclude coverage for the insured.

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