CPCU CPCU 552Managing Commercial Liability Risk

CPCU

2 hours·85 multiple-choice (a handful may be unscored pretest items)·≈70 study hours

Overview

CPCU 552, the second commercial concentration course, covers the Commercial General Liability (CGL) policy's three coverages (bodily injury/property damage, personal and advertising injury, medical payments), occurrence vs. claims-made trigger mechanics, key exclusions, commercial auto liability including the Business Auto Policy symbols, workers' compensation and employers liability, umbrella and excess liability layering, and specialty lines such as professional liability, directors and officers (D&O), employment practices liability (EPLI), and cyber liability.

Duration: 2 hours
Questions: 85 multiple-choice (a handful may be unscored pretest items)
Style: Computer-based, 4 answer choices, scenario-based stems
Credit: One of the CPCU program's course requirements
Passing: Scaled score; approximately 60/100 is the pass threshold set by The Institutes

Syllabus map

Commercial general liability (CGL) coverages A, B & C

25%

Occurrence vs. claims-made & key exclusions

15%

Commercial auto liability

15%

GL, Auto & Umbrella Pricing: Increased Limits and Excess Ratemaking

Workers' compensation & employers liability

15%

Umbrella & excess liability

15%

Specialty liability (professional, D&O, EPLI, cyber)

15%

Key formulas

Mostly conceptual; the numeric ideas that recur:

Umbrella/excess layering: $\displaystyle \text{Total available limit}=\text{Primary limit}+\text{Umbrella/excess limit}$ , with the umbrella typically attaching once the primary (or self-insured retention) is exhausted.

Claims-made retroactive date rule: coverage applies only if the claim is made during the policy period (or extended reporting period) AND the wrongful act occurred on or after the retroactive date.

Workers' compensation benefit types (conceptual): medical benefits (unlimited in most states) + indemnity (wage replacement, generally about two-thirds of average weekly wage subject to state maximums) + rehabilitation + death/survivor benefits.

Pro rata contribution among CGL policies (equal limits): $\displaystyle \text{Each insurer's share}=\frac{1}{n}\times\text{Loss}$ under an "equal shares" other-insurance clause, or by limits as in property.

Study strategy

Draw the CGL coverage triangle: Coverage A (bodily injury/property damage), B (personal & advertising injury), C (medical payments) — know what each does and does not cover.
Master occurrence vs. claims-made triggers and the role of the retroactive date and extended reporting periods (tail coverage).
Memorize the Business Auto Policy's numeric symbols (1 = any auto, 7 = specifically described autos, 8/9 = hired/nonowned, etc.) at a conceptual level.
Understand the 'exclusive remedy' doctrine in workers' compensation and when employers liability (Part B/Coverage B) fills the gap.
Build a short comparison of specialty lines (E&O/professional liability, D&O, EPLI, cyber) by who is insured and what wrongful act is covered.

Common traps

Assuming an occurrence policy responds based on when the claim is reported — it actually responds based on when the injury/damage occurred.
Forgetting that a claims-made policy needs both a claim made during the policy period AND a wrongful act on/after the retroactive date.
Confusing workers' compensation (no-fault, statutory benefits, exclusive remedy) with employers liability (fault-based, covers gaps like third-party-over suits).
Assuming an umbrella policy only 'follows form' — many also provide broader coverage than the underlying policy for some exposures, subject to a self-insured retention when no underlying policy responds.
Mixing up D&O (protects individual directors/officers and sometimes the entity for management wrongful acts) with EPLI (covers employment-related wrongful acts like harassment or wrongful termination).

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