Commercial General Liability (CGL) Policy Exclusion (l) Damage To Your Work
Liability coverage is not a replacement for a warranty or a guaranty of the performance to be given to an insured’s client. It does not replace faulty work or products, but it does cover the Bodily Injury and Property Damage caused by the faulty work or products. The exclusion of faulty work often referred to as “your work”.
The Commercial General Liability Coverage Form CG 00 01 excludes coverage for property damage to the insured’s completed work.
Exclusion (l) Damage To Your Work states:
“Property damage” to “your work” arising out of it or any part of it and included in the “products-completed operations hazard”.
This exclusion does not apply if the damaged work or the work out of which the damage arises was performed on your behalf by a subcontractor.
A contractor remodeled an upstairs bathroom for one of his clients. After the bathroom was complete and while the homeowner was away from the home, the connection to the bathtub came apart and flooded the house. Damage to the interior of the homes floors, baseboards, walls, contents, etc.
The claimant contacts the contractor, who calls, his insurance broker. An Adjuster is assigned, goes out and determines that there was a lot of water damage. It appears the contractors connection failed at the pipe, despite using the proper fittings, the connection just failed and came apart.
The claim is covered in full for the damages to the floors, baseboard, walls, contents, etc. as a result of the water damage. The contractor will not recover the pipe fitting or the labor.
Note~ Work is completed when:
• Contract work is complete
• Work at the site is completed
• Work has been put to intended use