1. Forms
2. CG
3. CG-21-93

What the form is

The CG 21 93, titled "Extended Reporting Period for Terrorism Coverage," is an endorsement designed for use with claims-made Commercial General Liability (CGL) policies. Its primary function is to provide a specific extended reporting period, often referred to as "tail coverage," for claims arising from acts of terrorism. This endorsement becomes crucial when other endorsements, specifically CG 21 87 (Conditional Exclusion Of Terrorism), CG 21 88 (Conditional Exclusion Of Terrorism Involving Nuclear, Biological Or Chemical Terrorism), or CG 21 89 (Conditional Limitation Of Coverage For Terrorism On An Annual Aggregate Basis), are attached to the policy. These conditional endorsements typically activate exclusions or limitations related to terrorism coverage if the federal Terrorism Risk Insurance Act (TRIA) is not renewed or is amended in a way that reduces coverage. The CG 21 93 ensures that if such a conditional exclusion takes effect, the insured still has a five-year period to report claims for acts of terrorism that occurred before TRIA's non-renewal or adverse change but were not reported during the policy period.

Classes of business it applies to

This endorsement is relevant for any business or organization that has a claims-made Commercial General Liability policy and faces potential terrorism exposure, particularly if endorsements CG 21 87, CG 21 88, or CG 21 89 are part of their insurance program. Examples include:

• Businesses located in high-profile urban areas or near critical infrastructure.
• Companies involved in industries that could be considered symbolic targets, such as transportation, energy, large retail centers, or entertainment venues.
• Organizations with contractual obligations to maintain terrorism coverage that might be impacted by changes to TRIA.
• Any insured whose underwriter deems the conditional terrorism endorsements (CG 21 87, CG 21 88, CG 21 89) necessary.

Special considerations

• Mandatory Attachment: The CG 21 93 endorsement is typically required to be attached whenever endorsements CG 21 87, CG 21 88, or CG 21 89 are added to a claims-made CGL policy. This is to prevent a potential coverage gap for terrorism-related incidents that occurred during the policy period but are reported after the conditional exclusions become effective due to TRIA's status.
• Scope of Extended Reporting Period: The five-year extended reporting period provided by this endorsement is specifically for acts of terrorism that would be excluded by CG 21 87, CG 21 88, or CG 21 89 due to the non-renewal or adverse amendment of TRIA, and which occurred before such non-renewal or amendment.
• Claims-Made Policies Only: This endorsement is specific to claims-made policies, where coverage is triggered by when the claim is made, rather than when the occurrence happened (as in occurrence policies).
• Interaction with TRIA: The utility and activation of this endorsement are closely tied to the status and provisions of the Terrorism Risk Insurance Act. Changes to TRIA can directly impact the applicability of the conditional endorsements it relates to.

Key information for agents and underwriters

• Agents: It is critical for agents to understand that if they are placing a claims-made CGL policy that includes CG 21 87, CG 21 88, or CG 21 89, the CG 21 93 should also be included to protect the insured from a significant coverage gap for prior acts of terrorism. Failing to do so could lead to an errors and omissions exposure for the agent. Agents should explain the function of this "tail" coverage to their clients in the context of TRIA and the conditional terrorism endorsements.
• Underwriters: Underwriters should ensure that this endorsement is consistently applied when the triggering conditional terrorism endorsements are used on claims-made policies. This maintains the integrity of the coverage offered and manages expectations regarding terrorism claims reporting post-TRIA changes. The presence of this endorsement acknowledges the specific risk of terrorism claims having a longer reporting tail under these circumstances. Pricing considerations for terrorism coverage should implicitly account for the potential of this extended reporting period. Risk assessment should continue to evaluate the insured's specific terrorism exposures.