Final answer:
The statement that medical payments coverage does not apply to product liability claims is incorrect. General liability policies typically cover medical expenses for injuries related to the insured's products, and this coverage is provided regardless of fault. However, it does not extend to loss of earnings.
Step-by-step explanation:
All of the following statements regarding medical payments under the general liability policy are true, EXCEPT:C. Medical payments coverage does not apply to product liability claims. Medical payments coverage under a general liability policy does typically apply to injuries sustained by third parties as a result of a product supplied by the named insured. However, there are some limitations and exclusions to this coverage.
For instance, medical payments coverage is typically intended to pay for immediate medical expenses incurred by a third party who is injured by the business's operations or products. The coverage is usually provided on a no-fault basis, meaning that it pays out regardless of who is at fault for the injury. It helps to prevent lawsuits by covering medical costs up front.
Regarding the statements provided:
- Loss of earnings as a result of injuries caused by a product of the named insured would not typically fall under medical payments coverage, as this type of coverage generally pays for immediate medical and funeral expenses, without extending to other damages such as loss of earnings.
- Medical payments claims can indeed be made for injuries caused by a product of the named insured.
- Medical payments coverage does apply to product liability claims, contrary to statement C, which is the incorrect statement among those provided.