article from the law firm of Wade Clark Mulcahy is important as it not only discusses an affirmation of coverage for faulty work
under a CGL policy but inversely also illustrates why Contractors need to consider augmenting their insurance programs with a properly constituted Contractor’s Professional Liability policy:
• It’s an appellate level decision from the U.S. Court of Appeals for the 10th Circuit interpreting that the NY Court of Appeals (highest court) would decide that faulty sub-contractor work can constitute an occurrence.
• Questions: But what if such faulty work:
- does not constitute an occurrence under a CGL policy, i.e. there is no property damage; or if there is property damage, coverage is negated by operation of one or more exclusions?
- was self-performed by the Named Insured and not a sub-contractor?
• Answer: Not covered. Again, Contractors must be informed that they cannot solely rely on a CGL policy but must also consider a properly constituted Professional Liability policy.
We here at Trinity know how to put such a policy together.