Reviewing the Unendorsed CGL Pollution Exclusion

As a broker, I tell my clients never to rely upon their CGL for pollution related liability. Although I choose those words carefully – “rely upon” – as in some situations the CGL can be somewhat responsive to pollution loses. In fact I once had an educator say he refers to the Pollution Exclusion as a “sieve” and I think that phrasing fits – there is some coverage but it must be a specific case that allows it to go through the “sieve”.

Below is a line-by-line analysis of the unendorsed ISO CGL Pollution Exclusion. Note this is 2007 wording as that is what my notes are predominantly for; I’m not aware of any significant changes since but please let me know if otherwise!

So let’s begin:

[This insurance does not apply to…]

f. Pollution

(1) “Bodily injury” or “property damage” arising out of the actual, alleged or threatened dis-charge, dispersal, seepage, migration, release or escape of “pollutants”:

(a) At or from any premises, site or location which is or was at any time owned or occupied by, or rented or loaned to, any insured. However, this subparagraph does not apply to:

Pollution at an owned/rented premises is referred to as “Premises Pollution” (natch) and is typically the primary (coverage A) insuring agreement of a standalone pollution policy.

Note that this exclusion applies at your premises regardless of whether they solely exist there (such as a storage tank) or if they were brought to your premises, even by a third party. If the “escape” of pollutants happens on your premises, coverage is excluded.

The exceptions to this:

(i) “Bodily injury” if sustained within a building and caused by smoke, fumes, vapor or soot produced by or originating from equipment that is used to heat, cool or dehumidify the building, or equipment that is used to heat water for personal use, by the building’s occupants or their guests;

(ii) “Bodily injury” or “property damage” for which you may be held liable, if you are a contractor and the owner or lessee of such premises, site or location has been added to your policy as an additional insured with respect to your ongoing operations performed for that additional insured at that premises, site or location and such premises, site or location is not and never was owned or occupied by, or rented or loaned to, any insured, other than that additional insured; or

(iii) “Bodily injury” or “property damage”arising out of heat, smoke or fumes from a “hostile fire”;

To summarize, we are adding back coverage for:

i. HVAC/Plumbing mechanicals releasing smoke

ii. Off-Premises work for an Additional Insured, and only for ongoing operations. We will see more restrictions later; this coverage grant is not nearly as broad as it seems.

iii. Smoke & fumes due to a fire at your premises

Continuing the exclusion:

(b) At or from any premises, site or location which is or was at any time used by or for any insured or others for the handling, storage, disposal, processing or treatment of waste;

(c) Which are or were at any time transported, handled, stored, treated, disposed of, or processed as waste by or for:

(i) Any insured; or

(ii) Any person or organization for whom you may be legally responsible; or

Naturally the CGL is not the policy for you if you handle waste in any capacity. This can be a catch for certain contractors, manufacturers, etc. who may handle, or haul debris that’s not theirs.

(d) At or from any premises, site or location on which any insured or any contractors or subcontractors working directly or indirectly on any insured’s behalf are performing operations if the “pollutants” are brought on or to the premises, site or lo cation in connection with such operations by such insured, contractor or subcontractor. However, this subparagraph does not apply to:

Here we see the additional limitations I mentioned earlier. The best way to visualize this is: if the pollutants are either yours, or from someone you hired, there is no coverage. This reinforces the intent of the CGL to not be a true “pollution” policy – if you handle pollutants, if you have an existing exposure for them, then CGL is not intended to protect from that.

There are a handful of exceptions here but, again, they are limited.

(i) “Bodily injury” or “property damage”arising out of the escape of fuels, lubricants or other operating fluids which are needed to perform the normal electrical, hydraulic or mechanical functions necessary for the operation of “mobile equipment” or its parts, if such fuels, lubricants or other operating fluids escape from a vehicle part designed to hold, store or receive them. This exception does not apply if the “bodily injury” or “property damage” arises out of the intentional discharge, dispersal or release of the fuels, lubricants or other operating fluids, or if such fuels, lubricants or other operating fluids are brought on or to the premises, site or location with the intent that they be discharged, dispersed or released as part of the operations being performed by such insured, contractor or subcontractor;

(ii) “Bodily injury” or “property damage”sustained within a building and caused by the release of gases, fumes or vapors from materials brought into that building in connection with operations being performed by you or on your behalf by a contractor or subcontractor; or

(iii) “Bodily injury” or “property damage”arising out of heat, smoke or fumes from a “hostile fire”.

There is a lot to unpack here, but I’d summarize these as:

i. Obviously your equipment is going to have “pollutants” inside of it (fuels, oil, etc.) and the CGL does cover unintentional release of those. However note the incredibly strict requirement that such release must be from a part of the vehicle designed to store those pollutants. In practical terms this means something like extra fuel you may bring in a can, or extra oils and lubes, will not be covered if they spill since those didn’t escape from “that part of the vehicle” designed to hold them. This really is only for (e.g.) an accident with your mobile equipment that releases incidental fuels and such.

ii. Once again we see a very specific set of wording here with “materials brought into that building“. The number of cases this is likely to apply will be very limited.

iii. This is similar to “hostile fire” wording we’ve seen before.

We have one final section to exclusion 1:

(e) At or from any premises, site or location on which any insured or any contractors or subcontractors working directly or indirectly on any insured’s behalf are performing operations if the operations are to test for, monitor, clean up, remove,contain, treat, detoxify or neutralize, orin any way respond to, or assess the effects of, “pollutants”.

Similarly to waste handling, the CGL is not sufficient if your operations are to otherwise work with pollutants (testing for, cleaning, etc.). The exclusion is fairly strict here – even if the liability is from a subcontractor you do not have coverage. This means simply “subbing out” your pollution related items (say requesting a survey before a job begins) is not enough to insulate you. You will need to review your sub’s coverages, request to be an AI, and/or otherwise look at your own policy.

Section 2 of the policy deals with the “non-liability (i.e., statutory) costs associated with pollutant losses:

(2) Any loss, cost or expense arising out of any:

(a) Request, demand, order or statutory or regulatory requirement that any insured or others test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of, “pollutants”; or

(b) Claim or “suit” by or on behalf of a governmental authority for damages because of testing for, monitoring, cleaning up, removing, containing, treating, detoxifying or neutralizing, or in any way responding to, or assessing the effects of, “pollutants”.

However, this paragraph does not apply to liability for damages because of “property damage” that the insured would have in the absence of such request, demand, order or statutory or regulatory requirement, or such claim or “suit” by or on behalf of a governmental authority.

This is important as standalone pollution coverage is available for these costs, many of which are quite substantial, especially if you’re dealing with waterways. Since this is also a completely separate section to the exclusion (item 2 instead of item 1) it also means that if you otherwise have coverage under the CGL for a pollution loss, you still won’t have statutory/regulatory compliance costs paid.

The Pollution Exclusion is one of the hardest to parse. For a personal “internal summary” I reiterate what I said before: my advice is to never rely on the CGL for pollution coverage. Even if you are “lucky” enough to have some sort of pollution loss covered you’re still bare for any sort of continued testing and regulatory compliance, costs which can accrue for literal years.

In a future article we will look at options for some coverage here, on the Auto, as well as a sample standalone policy. Stay tuned!

Hired & Non-Owned Auto on the GL – A Problem

Let’s say you have an insured with multiple companies, all owning various assets or performing different operations. A classic example is a property owner who deeds each of her properties into a separate LLC. No problem here – simply write a separate General Liability/Package policy for each location with a Designated Premises/Project limitation. This happens all the time, especially in the world of real estate where a designated premises endorsement is sometimes mandatory. 

Like a good insurance broker you recommend Hired & Non-Owned Automobile to the insured. For ~$150 to add to a BOP, and slightly more to put it on a Package, it’s a no-brainer upgrade – everyone should have this coverage in place. 

But here’s the rub – most Hired & Non-Owned coverage is an endorsement that amends the underlying General Liability… which you’ve limited to Designated Premises or Projects. Meaning your Hired & Non-Owned Auto coverage likely only protects the insured from BI/PD arising out of the ownership, maintenance, use, etc. of the designated premises, or only those operations you specified. 

As long as you put Hired & Non-Owned Auto coverage on each policy though, maybe you’re safe? Probably not 100%. Let’s say you have an insured that owns various real estate under the name “Real Estate LLC”. There are 3 properties, each insured with separate carriers for price or coverage reasons and each with a policy that contains a Designated Premises Limitation. You’ve done your job and endorsed Hired & Non-Owned onto to all 3 policies. 

Now this client, via their “Real Estate LLC”, is about to purchase a 4th property. They drive over to meet the seller and cause a serious accident. Very arguably the injured party can say your client was driving for/on behalf of “Real Estate LLC” – after all Real Estate LLC was the one making the deal to purchase this property. Clearly this is a Hired/Non-Owned situation – a member of Real Estate LLC was using an auto that Real Estate LLC does not own in its business on its behalf. 

Now remember – we have three policies written in the name of “Real Estate, LLC”. But all have a Designated Premises Limitation which says in part: 

[We cover liability for] The ownership, maintenance or use of the premises shown in the Schedule and operations necessary or incidental to those premises; 

While undefined, simply because an action is being conducted by a common owner doesn’t make that action “necessary or incidental” to any particular owned premises, otherwise this endorsement would be meaningless. So the question is – does looking at a new building, completely unrelated to your others, constitute “necessary or incidental” activities, as it relates to the other properties and their policies, thus triggering the General Liability coverage (and the Hired/Non-Owned endorsed thereto) under one or more? While ultimately a legal question, my answer would be an emphatic, “No.” 

There are solutions to this situation – write Hired/Non-Owned on a separate/standalone auto policy; this policy won’t be limited to the “Designated Premises” like the GL would be. Further, since a separate Hired/Non-Owned Auto policy would “follow the insured”, you wouldn’t need to endorse it on every policy that insured has – potentially saving money.

Granted, it can be difficult to find a carrier that will write standalone Hired & Non-Owned coverage, but it’s even more unlikely to be able to change or manuscript your GL coverage.

Granted, this is likely a small crack in coverage but it’s one to be aware of. It’s also more likely to affect “smaller” insureds who don’t have the clout – say a schedule of 50 properties – to be able to convince a carrier to offer exception. At the very least, though, even if you can’t find coverage you need to make your clients aware of the potential gap.

Additional Insureds: a Reference (Work in Progress)

As there are already tons of learning opportunities regarding Additional Insured status, this post will instead be a general reference – it already assumes you’re well versed in the world of Additional Insureds. The following notes are especially relevant to construction industry clients as these are the primary drivers of complex AI requests, in my experience.

Since this is a reference it will be updated periodically. I will initially start with the oft-used GL AI forms, found especially in the construction world, and then proceed to review other options and how different lines handle AI. Please excuse any inelegant formatting and such as I’m still debating on how best to organize.

General Liability:

  • CG 20 10 11 85 – the “OG”, first created after the CGL overhaul in 1985.
    • No limitation for Ongoing vs. Completed Ops
    • Has historically been litigated to provide *sole* coverage for the AI (i.e., not limited to vicarious only)
    • Technically out of use for ages but many, many carriers still offer it as market demand (via contracts) is high
    • Still contains “[work] for that additional insured” limitation (see later) which can cause havoc with improper blanket wording
  • CG 20 10 10 01 – Very similar to CG 20 10 11 85, except limited to ONGOING operations only.
  • CG 20 37 10 01 – Very similar to CG 20 10 11 85, except limited to COMPLETED operations only.
    The pair of CG 20 10 10 01 and CG 20 37 10 01 are functionally equivalent to the CG 20 10 11 85.
  • CG 20 10 07 04 & CG 20 37 07 04 – Uses the “10 01” language but adds the restriction that liability which triggers coverage for the AI must arise “in whole or in part” by your actions or those acting on your behalf.  I.e., removes “sole negligence” coverage for the AI.
  • CG 20 10 04 13 & CG 20 37 04 13 – Uses the “07 04” language but adds the further restrictions that coverage is only provided to the AI is permissible by law and, if the AI status/coverage is dictated by contract, only to the extent required by the contract. E.g., if your contract only requires $500K of AI coverage but you have a $1M policy/AI endorsement, the endorsement will be limited to the contractually obligated amount.
  • CG 20 10 12 19 & CG 20 37 12 19 – Functionally equivalent to the “04 13” versions but an administrative clarification was made – the “Limits of Insurance” verbiage was amended to remove the reference to the limits “shown on the Declarations”; rather the endorsement merely states the AI coverage will not increase available limits (rather than “will not increase the limits [shown on the declarations]”. This is in recognition of the fact that limits can be amended by endorsement and thus the “hard” reference to the declarations may be in error. I am not aware of a lawsuit that prompted this but if you know of one please send my way!

The above endorsements are strictly “Scheduled” AI forms – meaning their technical use is limited to name a single, explicit entity to whom AI coverage is given. However it’s very common to have endorsements with manuscripted “blanket” language – for example the schedule might read “All parties with whom you have an executed written agreement to provide Additional Insured Coverage” or similar.

This is usually not a problem – and often the preferred way of writing these endorsements since many contractual parties want to see specific endorsement numbers – but it definitely can be. This is because each of these endorsements, even the “11 85”, has a limitation that states, essentially, coverage is limited to operations performed for the named Additional Insured. Here is the relevant text from the CG 20 10 12 19, emphasis added:

[…] in the performance of your ongoing operations for the additional insured(s) at the location(s) designated above.

Note the explicit reference to both the Additional Insured (and location).  This means that if your blanket language is insufficient, you could be leaving out a LOT of coverage for a LOT of third parties.

This is primarily a concern when the blanket language references only parties with whom you have a direct contractual relationship (privity).  For example, in Westfield Insurance v. FCL Builders, Inc. the insured’s “Blanket” wording read:

“A. Section IIWho Is an Insured is amended to include as an additional insured any person or organization for whom you are performing operations when you and such a person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy.”

Reading that via the “four corners” analysis (as insurance courts are designed to do), the only entities to whom that “blanket” AI language applies are those with whom you have a contractual agreement that such person or organization be added as an Additional Insured.

However, contracts require multiple third parties to be named as AI all the time – and an insured signing the contract typically doesn’t have a direct contractual relationship with these parties (say an owner, or bank). Because of this, the above blanket AI wording is limiting – it does not apply to those third parties whom you were obligated to add as AI but with whom you do not have contractual privity.

Because of this you must, must, must negotiate the proper “blanket” wording for AI forms. Simply securing the 10/01 or 11/85 editions is not enough – you must ensure it responds properly to all those entities to whom your insured is obligating themselves.

This privity concern is also a huge issue when ISO attempted to provide a standard “automatic” AI status. Firstly, ISO released such endorsement only for Ongoing Operations, then while they did finally release one for Completed Ops as well both contained the privity issue, necessitating another set of endorsements (automatic status for other parties). When this post is updated in the future we will review those endorsements (CG 20 33, CG 20 38, CG 20 39, CG 20 40). The “TL;DR” of that is that the combination of those will imitate CG 20 10/20 37 12 19, but if you need “old” coverage you’re stuck with the above scheduled forms until the cows come home.

When Outside Defense Isn’t

Defense costs “Outside” the Limit of Insurance is almost taken for granted and it’s becoming a more common feature for policies that have historically been purely “Inside Limits” policies.  Even with policies such as Directors & Officer’s Liability you’re seeing additional limits and – depending on the type of policy (Non-profit, etc.) – full “Outside Limits” Defense coverage. 

Defense is usually paid as “supplemental costs” in a policy, and an insuring agreement will usually say something like, “We will pay all costs we incur, including legal and defense fees.” It is important to highlight, then, that it isn’t *technically* “Defense Costs” that are “outside the limits” on these policies, rather it’s the non-indemnity costs incurred.  This is an important distinction when a policyholder has agreed to indemnify someone via contract. The short version of why is because contractual costs are “indemnity” loses to the policy holder, even if those costs are earmarked in the contract for defense.

The reason for this is because indemnity, even of a third party’s defense costs, are considered “damages” (or similar) by the policy. In fact the CGL expressly says this. In the Contractual Liability exclusion of the CG 00 01 10 01, to which there are many exceptions, we find this language: 

Solely for the purposes of liability assumed in an “insured contract”, reasonable attorney fees and necessary litigation expenses incurred by or for a party other than an insured are deemed to be damages… 

Note there are some provisions you can find under “Supplementary Payments” that allow defense costs “outside” for the indemnitee when various conditions are met, and these typically require the indemnitee to subjugate themselves to handing over all defense options to the insuring carrier – something many won’t wish to do.

I’ve seen contracts that specifically require one party to indemnify another and specifically states that any insurance defense should be “outside” the limits. On the retail side this problem is often met by adding an Additional Insured provision to the policy. But this isn’t a perfect solution either as many Additional Insured provisions are now, themselves, stating that defense costs are specifically “inside” the Limit of Insurance. 

This type of language has not yet made it into ISO forms, as far as I’m aware, but we have seen ISO continue to restrict Additional Insured endorsements. One major recent change being that (e.g.) on the CG 20 10 the coverage afforded to an Additional Insured is specifically limited to that which is required by the contract. This alone could be sufficient for a carrier to say that “outside” defense coverage shouldn’t be assumed as “required by the contract”, hence the AI does not enjoy such. 

Even if not, I imagine we’ll see some of the “Standard” Additional Insured endorsements specify “inside” defense coverage soon enough, though “soon enough” is relative in the insurance industry when changing a comma on an ISO form can take a decade. For now, take a close look at your AI endorsements and any “automatic” provisions to see what is offered; this limitation could already be in place – this is especially the case for proprietary/non-standard/excess lines forms.

Three Tips for Leased Employees 

So many businesses lease employees that it’s hardly given a second thought. Yet I cannot think of one single insurance policy that doesn’t include the word “Employee” in there somewhere – even (and especially) the ones you may not think about, like Cyber. This is relevant because, typically, when a carrier defines a term it’s to limit coverage in some capacity.

Because of this, it’s very important to understand your clients’ employee situations. Are there “standard” employees, are there independent contractors, is there seasonal or temporary help, are there volunteers, etc. etc. All of this plays into the various insurance policies and sometimes in completely different ways. Here are three tips to handle leased employees but these should be thought of as the start of your investigation, not the end of it.

1:   Always, always, always check the definition of “Employee” because it’s usually used to exclude something. 

This may seem like common sense but it bears mentioning. Policies, especially non-standard ones like Professional Liability, define “employee” very differently. For example, a Professional Liability policy might not include “leased employees” as employees since such individuals are expected to have their own coverage (perhaps from the leasing firm). 

Or, even when certain classes of individuals (like “leased employees”) are granted coverage, very strict limits can apply.  For example, sometimes the coverage your policy offers is limited to whatever that leased individual has elsewhere – so your $2M limit could only $500K if that’s what the leased employee brings for themselves. It’s also common to restrict coverage only for your vicarious liability for that leased individual and not their individual/direct liability.

Another extreme example of where the definition matters is in Crime policies. Insuring Agreement I (“Employee Theft”) is almost always the broadest coverage available, covering basically any dishonest act by an employee not otherwise excluded. Many crime policies are written with only this insuring clause and this is usually the Crime coverage you see added into Package policies. If a client operates on a permanent-contractor basis, where a good portion of staff are all independent contractors, they need a fitting definition of “employee” because otherwise that entire insuring agreement is useless.

To digress a bit: on Crime policies this can cut both ways. While “Employee Theft” is usually very generous coverage there are sometimes qualifications. For example, many policies require that an employee be identifiable for a theft to be covered under Insuring Agreement I. Thus there can exist a situation where technically not having someone considered an employee could be beneficial, assuming you’ve got coverage for the theft under another Insuring Agreement. But this is really a quirk only and definitely not a mark in the favor of exempting people from the definition of “Employees”. 

Sometimes Employee is undefined in a policy. This is typically a good thing since undefined terms are construed in the insured’s favor. However, I’ll take a broad, inclusive definition of employee (e.g. one that simply states what “Employee” includes, like “Employee includes a leased worker, temporary worker, and contract worker”) over an undefined definition any day. This is only a personal preference, but I am much happier when I can point to policy language itself to show that a “leased employee” is an “employee” rather than relying upon assumed interpretive benefit. 

2:   Make sure your definitions/coverage are consistent and complimentary. 

Just as important as knowing who is an employee is making sure that flows across your entire insurance program. For example, does your Umbrella define employee in the same manner?

This question becomes crucial if you’ve amended the underlying at all, such as to specifically include/exclude particular individuals as employees or if you’ve amended the underlying to include/exclude injury to these employees. A cautionary tale comes from the Business Auto side: Employees as Insureds. 

Employees as Insureds allows you to have a BAP cover an employee-driver directly in situations where (e.g.) they use their personal auto in the business. You do this by adding an endorsement specifically including “Employees” as insureds. This is a great deal for individuals such as executives who both constantly use their vehicles for business and have significant assets to protect. 

The problem arises if you don’t also pay attention to your Excess/Umbrella. All Umbrellas, yes even “Follow Forms” have their own terms and conditions.  Often these mirror unendorsed standard wording.  For example, take a look at ISO’s wording (pg. 10 of 17): it specifically excludes employees driving their own auto, just like an unendorsed BAP (emphasis added): 

[Who is an Insured is…] 

  1. Anyone else while using with your permission a “covered auto” you own, hire or borrow is also an insured except:


(2) Your “employee” if the “covered auto” is owned by that “employee” or a member of his or her household.   

Now some comprehensive “additional insured” type wording might do the trick, but again look at ISO:   

  1. Any additional insured under any policy of “underlying insurance” will automatically be an insured under this insurance.

If coverage provided to the additional insured is required by a contract or agreement, the most we will pay on behalf of the additional insured is the amount of insurance required by the contract, less any amounts payable by an “underlying insurance”. 

Additional Insureds are usually just that – those persons or entities listed, specifically, as an “Additional Insured”, not those parties who fall under the “Who Is an Insured” section. Remember, we’re adding Employees as Insureds, not as Additional Insureds. Insureds get primary coverage; AIs don’t. They are separate and distinct entities for good reason. I don’t think ISO’s language cuts it when we add Employees as Insureds to an underlying Auto policy. 

The argument can be made that this wording is vague, and to be construed in the insured’s favor and that additional insured here (undefined) means any party for whom you’ve added any sort of coverage for on the underlying. 

While I don’t buy that argument I’d certainly make it if it were my client’s assets on the line. But this goes back to my point about preferring a definition in black-and-white rather than relying on interpretive benefit. I’m not sure if there’s case law on the specific matter of what constitutes an Additional Insured in ISO’s umbrella, and maybe it is meant to include situations like this, but I don’t want to find out the hard way. Further, most Umbrella policies you see will NOT be ISO-standard; one little word change and the whole situation is different. 

Long story short on point 2 – each policy will define “employee” differently and you need to make sure they play nice together.

  1. Having only leased employees does not mean you can skip Work Comp (really).

For reasons best put in its own article, having only leased employees does not allow one to forego Workers Compensation coverage. For the curious, I’d suggest this IRMI article on the topic. The “too long; did not read” version is this you can be held civilly liable for injury to leased employees (n.b. you can be held liable under Work Comp statutes as well but we’re assuming the leasing company provided this). 

This means three things: (1) you can get sued for their injury, (2) the “Exclusive Remedy” of Work Comp doesn’t apply to you, and (3) your CGL won’t cover it due to the Employer’s Liability exclusion. 

There is an ad hoc solution in that ISO has the following endorsement: CG 04 24 – “Coverage for Injury to Leased Workers”. This amends the definition (Remember point #2! Check your excess!) of “employee” on the CGL to not include leased workers for the purposes of the Employer’s Liability exclusion. Since leased worker is no longer an employee, the employer’s liability exclusion will not apply to leased workers. Thus, you get Employer’s Liability coverage, under the CGL, for injury to leased workers. 

Even with the bargaining power to secure this, it is a stop-gap for a very specific situation only. The only other option, as silly as it sounds, is for your client who does not have “employees” to buy a Workers’ Compensation policy. This might be equally hard to accomplish, and may mean a minimum premium state “Pool” policy, but is probably the better option. 

With a standalone Comp policy you get Work Comp coverage in additional to Employer’s Liability.  Sure, if your leased employees are actually not “employees”, and if the leasing company has their own coverage, and if you’re named as an Alternate Employer, then you probably don’t need true Work Comp coverage. But “probably” is not “definitely”. 

Second – when you have a standalone Work Comp policy you can also schedule it to the excess and it will work like you think it will. Whereas if you’re amending underlying coverage you again run into the lack of congruity between your underlying and excess. It’s just the more elegant solution. 


These are by no means the only things to look out for when dealing with leased employees but I will say they are probably some of the most important. Even a minor situation can turn real ugly simply because someone is or is not considered an “employee”. Don’t rely on 1099s, don’t rely on the client – read the language and see how the policy interacts with employees. 

And “leased” employees aren’t the whole picture by any stretch. For further reading, this article (“The Law of ‘Leased Worker’ and ‘Temporary Worker’ Under a CGL Policy”) offers a good in-depth legal interpretation of “Leased” vs. “Temporary” in the CGL.