Under what conditions and for how long does Newly Acquired Organizations extend CGL coverage?

• A. It extends coverage to newly acquired or formed organizations for a limited period, typically 90 days, under a potential automatic extension, subject to limits.
• B. It extends coverage to newly acquired organizations for one year only with a new policy.
• C. It requires endorsement if the acquisition exceeds 30 days; no automatic extension.
• D. It does not extend coverage under any circumstances.

Answer: (A)

Newly Acquired Organizations in a CGL policy provides a built‑in automatic extension of liability coverage to a newly acquired or formed organization for a limited time. This extension typically lasts up to 90 days from the date of acquisition or formation and covers claims related to the insured’s ongoing operations, products and completed operations, and advertising liability, up to the policy’s limits. It’s automatic for that initial period, so you don’t need a separate endorsement right away; after 90 days, you’d need to arrange individual coverage for the new entity if continued protection is required. This is why the correct choice describes a limited, automatic 90‑day extension, subject to the policy limits. The other options imply a longer period, a requirement for an endorsement sooner, or no extension at all, which don’t fit how this coverage works.