10.5 Other States and USL&H Coverage

Property & Casualty Insurance Exam

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1 Introduction

0.1 About the Property & Casualty Exam 0.2 How to Use This Course

2 Chapter 1: Insurance Fundamentals

1.1 Risk and Risk Management 1.2 Types of Risk 1.3 Principles of Insurance 1.4 The Insurance Contract 1.5 Policy Structure and Components

3 Chapter 2: Property Insurance Concepts

2.1 Property Coverage Basics 2.2 Perils, Hazards, and Exclusions 2.3 Valuation Methods 2.4 Coinsurance and Insurance to Value 2.5 Deductibles and Policy Limits

4 Chapter 3: Dwelling Policies

3.1 Dwelling Policy Overview 3.2 Dwelling Policy Forms (DP-1, DP-2, DP-3) 3.3 Dwelling Property Coverages 3.4 Dwelling Exclusions and Conditions

5 Chapter 4: Homeowners Policies

4.1 Homeowners Policy Overview 4.2 Homeowners Policy Forms (HO-2 through HO-8) 4.3 Section I: Property Coverages 4.4 Section II: Liability Coverages 4.5 Homeowners Exclusions 4.6 Homeowners Conditions 4.7 Common Homeowners Endorsements

6 Chapter 5: Personal Auto Policy

5.1 Personal Auto Policy Overview 5.2 Part A: Liability Coverage 5.3 Part B: Medical Payments Coverage 5.4 Part C: Uninsured/Underinsured Motorists 5.5 Part D: Physical Damage Coverage 5.6 PAP Exclusions 5.7 No-Fault Insurance and PIP

7 Chapter 6: Liability Insurance Concepts

6.1 Liability Insurance Basics 6.2 Negligence and Tort Law 6.3 Types of Legal Liability 6.4 Personal Umbrella Policies

8 Chapter 7: Commercial Property Insurance

7.1 Commercial Package Policy (CPP) 7.2 Building and Personal Property Coverage Form 7.3 Causes of Loss Forms 7.4 Business Income Coverage 7.5 Businessowners Policy (BOP)

9 Chapter 8: Commercial General Liability

8.1 CGL Policy Overview 8.2 Coverage A: Bodily Injury and Property Damage 8.3 Coverage B: Personal and Advertising Injury 8.4 Coverage C: Medical Payments 8.5 CGL Exclusions 8.6 CGL Limits and Conditions

10 Chapter 9: Commercial Auto Insurance

9.1 Business Auto Policy Overview 9.2 Covered Auto Designation Symbols 9.3 BAP Liability Coverage 9.4 BAP Physical Damage Coverage 9.5 Garage and Truckers Coverage Forms

11 Chapter 10: Workers Compensation

10.1 Workers Compensation Overview 10.2 Part One: Workers Compensation Insurance 10.3 Part Two: Employers Liability 10.4 Workers Compensation Exclusions 10.5 Other States and USL&H Coverage

12 Chapter 11: Other Commercial Lines

11.1 Inland Marine Insurance 11.2 Ocean Marine Insurance 11.3 Commercial Crime Insurance 11.4 Surety Bonds 11.5 National Flood Insurance Program 11.6 Professional Liability Insurance 11.7 Commercial Umbrella and Excess Liability 11.8 Boatowners and Personal Watercraft Insurance 11.9 Farm and Ranch Insurance 11.10 Mobile Home and Manufactured Housing Insurance 11.11 Title Insurance

13 Chapter 12: Insurance Regulations and Ethics

12.1 Producer Licensing 12.2 Producer Authority and Responsibilities 12.3 Unfair Trade Practices 12.4 Claims Settlement Practices 12.5 State Insurance Department 12.6 Penalties and Disciplinary Actions

10.5 Other States and USL&H Coverage

Key Takeaways Explain This Topic AI

Item 3.A lists states where Part One applies at inception; Item 3.C 'Other States Insurance' extends coverage to states a worker may travel into later

Other States Coverage CANNOT reach monopolistic states (OH, ND, WA, WY) — those require a separate state-fund policy plus stop gap employers liability

USL&H covers longshore, harbor, and ship-repair workers on navigable waters; it is added to the WC policy by the Longshore endorsement (WC 00 01 06)

The Jones Act covers seamen/vessel crew and the USL&H Act covers longshore workers — the two are MUTUALLY EXCLUSIVE

FELA (railroads) and the Jones Act (seamen) are negligence-based, not no-fault, and allow recovery of pain-and-suffering damages unavailable under state comp

Last updated: June 2026

Where the Policy Applies: Item 3.A vs. 3.C

The Information Page of the standard WC policy controls geography:

Item Name Function
3.A Primary states States where the employer operates at inception; Part One applies there in full

3.C Other States Insurance Lists states the employer may expand into later; coverage springs up automatically if operations begin there

Other States Coverage matters when an employee travels or temporarily works outside the home state. If Item 3.C lists "all states except those in 3.A and the monopolistic states," the policy automatically covers a new state when work begins there — paying benefits under that state's law. A state not listed in 3.A or 3.C, and where the employer was operating at inception, is uninsured.

The Monopolistic Limitation (Exam-Testable)

Other States Coverage cannot extend to Ohio, North Dakota, Washington, or Wyoming . To cover a worker there, the employer must:

Buy a separate policy directly from the state fund (private WC is prohibited)
Add stop gap employers liability to its CGL
It may not rely on the Item 3.C endorsement
The Four Monopolistic Funds

State Fund
Ohio Bureau of Workers' Compensation (BWC)
North Dakota Workforce Safety & Insurance (WSI)
Washington Department of Labor & Industries (L&I)
Wyoming Department of Workforce Services

Puerto Rico and the U.S. Virgin Islands operate similarly. State funds provide Coverage A only , never employers liability — hence the stop-gap requirement covered in 10.3.

Federal Workers' Compensation Programs

Four federal acts override state comp for specific occupations. Two are no-fault; two are negligence suits.

USL&H Act (Longshore and Harbor Workers' Compensation Act, 1927)

Covers: longshore workers, harbor workers, ship builders/repairers/breakers, and workers on or adjoining navigable U.S. waters (piers, wharves, dry docks, terminals)

Excludes: seamen and crew (Jones Act), and small-vessel/clerical/recreational workers under stated exemptions
Benefits: no-fault, similar structure to state comp including wage replacement

How it attaches: by the Longshore and Harbor Workers' Compensation Act Coverage Endorsement (WC 00 01 06) added to the WC policy

Dual jurisdiction: in some coastal states a worker can claim under both USL&H and state comp
Jones Act (Merchant Marine Act, 1920)
Covers: seamen — a master or member of the crew of a vessel

Negligence-based: the seaman must prove the employer's negligence (or vessel unseaworthiness), but may then recover pain and suffering

Mutually exclusive with USL&H: "master or member of the crew of any vessel" → Jones Act, never USL&H. A worker fits one or the other, not both

FELA (Federal Employers Liability Act)
Covers: interstate railroad workers

Negligence-based , not no-fault; the worker must prove the railroad's negligence and may recover pain and suffering — awards can far exceed scheduled comp benefits

FECA (Federal Employees' Compensation Act)
Covers: civilian federal government employees
No-fault , administered by the U.S. Department of Labor
Decision Map for the Exam

Work through worker type first, then geography:

Railroad worker? → FELA (prove negligence)
Seaman / crew? → Jones Act (prove negligence)
Longshore / harbor / ship repair? → USL&H (no-fault, WC 00 01 06)
Federal civilian? → FECA

Otherwise a state worker traveling out of state? → Other States Coverage if the state is in Item 3.C and not monopolistic; if monopolistic, buy from the state fund plus stop gap.

Reading the Information Page Items

The whole geography question turns on three numbered items on the WC Information Page. Knowing each cold prevents most location traps:

Item Contents
Item 1 Named insured, mailing address, legal status
Item 2 Policy period (effective and expiration dates)
Item 3.A States where the employer has operations at inception — Part One applies fully
Item 3.B The Part Two employers liability limits ($100K/$500K/$100K standard)
Item 3.C Other States Insurance — states the employer may enter later
Item 3.D Endorsements and any explanatory schedule items
Item 4 Premium basis: classifications, rates, and estimated payroll

Exam Key: A state must appear in 3.A or 3.C for the policy to respond there. If an employer was already operating in a state at inception but it is in neither , that exposure is uninsured — the very gap Item 3.C is designed to close for future expansion.

Why Other States Coverage Matters

Without Item 3.C, an employer that opens a new branch in a previously unlisted state would have no coverage there until it amended the policy — a dangerous gap if a worker is hurt the first day. Other States Insurance closes that timing gap: the moment operations begin in a 3.C state, full statutory coverage springs up under that state's law. The carrier then picks up the new exposure at audit. This is purely a convenience for non-monopolistic states; the four state-fund jurisdictions can never be added this way.

USL&H Twenty-Percent Maximum and Dual Jurisdiction

USL&H benefits are tied to the national average weekly wage , with a statutory maximum, and are administered by the U.S. Department of Labor's Office of Workers' Compensation Programs. In dual-jurisdiction coastal states, a single waterfront injury can support a claim under both the federal USL&H Act and the state comp act; the worker generally cannot double-recover, but may choose the more favorable forum. The Outer Continental Shelf Lands Act (OCSLA) extends USL&H to workers on fixed offshore drilling platforms — a detail worth recognizing if it appears.

Federal Acts at a Glance

Act Worker No-Fault? Pain & Suffering?

USL&H Longshore / harbor / ship repair Yes No
Jones Act Seaman / vessel crew No (negligence) Yes
FELA Interstate railroad No (negligence) Yes
FECA Federal civilian employee Yes No

Exam Key: The two negligence acts (Jones Act, FELA) are the only ones that allow pain-and-suffering recovery; the two no-fault acts (USL&H, FECA) pay a benefit schedule like state comp.