Bodily injury refers to physical harm and the results of that harm. The term is used in many types of business insurance to clarify what's covered by a policy.
Learn more about bodily injuries and what they entail.
What Is Bodily Injury?
Many commercial liability policies use the term bodily injury, including most commercial auto, general liability, and commercial umbrella policies. Many policies use the same definition of bodily injury as the standard Insurance Services Office (ISO) commercial general liability (CGL) policy. The ISO is an advisory organization that develops policy templates that insurance companies often use.
The ISO CGL states that bodily injury means "bodily injury, sickness, or disease sustained by a person, including death resulting from any of these at any time." Bodily injury includes illness and disease as well as physical injury. It also includes death if death results from bodily injury, sickness, or disease. A death that results from unexplained causes doesn't usually qualify for a claim under a CGL policy.
How Bodily Injuries Work
If a client is injured on your business' property or due to work being done by your firm, they may file a claim or sue due to bodily injury.
Some policies limit bodily injury coverage to physical injuries, while other general liability policies contain a broader definition which can include shock, fright, mental injury, mental anguish, or humiliation. When psychological injuries are included, they're generally covered only if they result from a physical injury.
For example, suppose that Bob is shopping in a home improvement store and a store employee is using a forklift to move some heavy boxes. The employee accidentally crashes into Bob. Bob's leg is severely injured in the accident and must be amputated.
Bob suffers mental anguish over the loss of his leg. He sues the home store for both physical injury and mental anguish.
The store is insured under a general liability policy that includes mental anguish in the definition of bodily injury. Because Bob's mental anguish stemmed from his physical injury, he will most likely receive compensation for both the physical injury and his mental anguish.
Bodily injury coverage typically covers the cost of care up to your policy limits, including hospital and medical bills, lost earnings, rehabilitation, long-term care, and funeral expenses. If found liable, you may be responsible for costs after your policy limits are exceeded. Keep these potential costs in mind when you determine how much liability coverage to get for your business.
Mental Injury Without Physical Injury
The standard ISO definition of bodily injury makes no mention of psychological injuries like shock. Whether policies will cover a mental injury without a physical one depends on the policy. Here's an example.
Suppose that Bob notices the forklift approaching as he's shopping in the store. The store employee doesn't see Bob. Bob watches in horror as the forklift comes straight toward him. The vehicle is about to slam into Bob's leg when the employee finally notices Bob. He swerves at the last second, missing Bob by a hair.
Bob suffers anxiety attacks as a result of the near-miss. He sues the store for mental anguish. Even if the store's liability policy includes mental anguish in its definition of bodily injury, Bob's claim isn't likely to be covered because Bob didn't suffer any physical injuries.
The rule regarding mental-only injuries does have some exceptions. In a few states, courts have determined that purely psychological injuries can constitute bodily injury. Mental stress, anxiety, or other mental issues could qualify as bodily injury in these states even if the mental injury didn't result from a physical injury.
Bodily Injury and Umbrella Policies
Many commercial umbrella policies contain a broader definition of bodily injury than the ISO CGL. Umbrella policies cover claims that exceed the limits of other policies. In umbrella policies, bodily injury is likely to include some type of psychological injury such as mental anguish. Most umbrella policies limit coverage to mental injuries that result from physical ones.
Many umbrellas include a self-insured retention (SIR). The SIR applies to claims covered by the umbrella but not by the underlying insurance. If your umbrella covers mental injuries but your general liability policy doesn't, the SIR will apply to a bodily injury claim that includes mental injuries.
Bodily Injury vs. Personal Injury
|Bodily Injury||Personal Injury|
|Insurance term||Legal and insurance term|
|Refers to physical or mental harm||In legal terms, refers to any harm done to a person due to negligence|
|In insurance terms, refers to injury done to a person's reputation|
Lawyers often refer to bodily injury as "personal injury." In the legal profession, a personal injury attorney represents individuals who have been physically or mentally injured in accidents caused by someone else's negligence.
Attorneys' use of the words "personal injury" can confuse policyholders and insurance professionals alike. This is because personal injury has an entirely different meaning in the insurance industry than it does in the legal profession. In a general liability policy, personal injury is included in personal and advertising injury, a defined term that encompasses various intentional acts like libel, slander, and false arrest.
- Bodily injury refers to physical harm and the results of that harm. The term is used in many types of business insurance to clarify what's covered by a policy.
- Commercial auto, general liability, and commercial umbrella policies may all define and cover bodily injuries.
- If a client is injured on your business' property or due to work being done by your firm, they may file a claim or sue due to bodily injury.
- Bodily injury coverage may include mental anguish. Some insurance may cover mental injury without a physical one.
- Personal injury, in insurance terms, refers to damage to a person's reputation. In legal terms, a personal injury can refer to bodily injuries as well as other types of harm.
North Star Mutual. "Commercial General Liability Coverage Form," Page 13. Accessed Aug. 23, 2020.