I. Supplemental Information. CREC has procured a business owner policy (BOP) that contains a commercial general liability policy (CGL) with each occurrence limit of $1 million, a personal and advertising injury limit of $1 million, a general aggregate limit of $2 million, and a products completed operations aggregate limit of $2 million. Damage to premises rented to CREC - $100,000 on any one premise and medical expense of $5,000 for any one person. Any and all other incidental coverages contained within the CGL are established at minimum levels. CREC has also procured a commercial excess liability (umbrella) following form with each occurrence limit (liability coverage) of $1 million; personal and advertising injury limit (any one person or organization) of $1 million; and aggregate limit (liability coverage except with respect to covered autos) of $1 million.

What dollar amount, if any, will CRECs BOP insurer (including umbrella carrier) pay for each of the following losses that occurred during the policy period and why or why not will it pay the loss? If the loss is not covered, or not fully covered, explain why. Assume that each loss would be paid in the order presented.

A. CREC placed an advertisement in the local newspaper that made inaccurate and unfavorable statements concerning a real estate developers senior assisted living facility project because CREC was not awarded the electrical contract portion of the construction. The real estate developer sued CREC and Jones individually for libel and was awarded $1,500,000 after a 2-week jury trial that was later affirmed by the Iowa Supreme Court. (5 POINTS)