Los Angeles Claims Adjuster Property and Causality Practice Exam

What does the severability clause in a CGL policy ensure?

1. All insureds are treated equally

2. Each insured receives independent defense and investigation

3. Claims are assessed collectively

4. Limits of liability are doubled for multiple insureds

The correct answer is: Each insured receives independent defense and investigation

The severability clause in a Commercial General Liability (CGL) policy is designed to protect each insured individually under the policy. This means that if there are multiple insureds listed in the policy, each one will be treated independently regarding coverage, particularly in the case of a claim. This clause ensures that if one insured is found to be negligent and potentially resulting in a claim, the actions of that insured do not impact the coverage available to other insureds. Therefore, each insured is entitled to their own defense and investigation as if they were the only one covered under the policy. This independent treatment helps prevent one insured's issues from undermining the coverage afforded to others, thereby providing a more robust protection structure for all parties involved. In comparison, the other options do not accurately reflect the purpose of the severability clause; they either overstate the benefits it offers or misinterpret the relationship among the insured parties under the policy.