This new series of articles by American Global explores progressive design build. This first article examines design-build procurement best practices and the measures contractors and designers can take to reduce or mitigate risk of loss.
Loss of Use as Property Damage—Not all losses to or impairment of property is considered property damage. Craig Stanovich delves into the evolution and application of the term as it pertains to liability insurance.
Other Insurance and Allocation in Construction Defect Claims—Joseph Junfola discusses how property damage is allocated when multiple occurrence-based commercial general liability policies are triggered.
Most liability insurance policies contain a 'severability of interests' condition, which stipulates that coverage applies 'separately' to each insured. This article, and the two to follow, examine coverage issues raised by this condition in the ISO CGL policy.
Insurance professionals must make determinations whether 'mobile equipment' is subject to motor vehicle registration and financial responsibility laws or compulsory insurance laws. Craig Stanovich provides advice.
Craig Stanovich discusses the new changes to the additional insured endorsements and the introduction of a limitation to the definition of 'insured contract' characterized by ISO as coverage reductions.
In March, Insurance Services Office, Inc. (ISO) began filing a revision of the standard commercial general liability (CGL) insurance coverage form, scheduled for implementation with policies written or effective on or after December 1, 2004. In this article, Jeff Woodward looks at the most significant revisions.
There is an ongoing debate in the industry whether EIFS liability exposures can be underwritten or should simply be excluded. IRMI analyst Ann Hickman provides some insights into how an underwriter might evaluate the risks faced by a contractor from exterior insulation and finish systems.
Insurers are making significant changes to their policies in response to rising construction defect claims. Ann Rudd Hickman takes a look at these changes, including those affecting known loss, EIFS, mold, earth movement, residential construction, additional insureds, and others.
Wielinski explains how a recent Texas Supreme Court case may finally put to rest the question of whether the CGL policy provides coverage for the defective work of others despite the definition of occurrence.
Taking on responsibility for design in addition to construction entails many new risks. This article examines the potential liabilities facing design-builders and how they can be handled. Also see IRMI's new book by the most knowledgeable practitioners in the industry, Design-Build Risk and Insurance, which offers you their insight in one handy, well-organized guide.
A new edition of the Insurance Services Office, Inc. (ISO), commercial general liability (CGL) policy was implemented in December. This article summarizes the significant changes in coverage, particularly as respects coverage for Internet exposures.
In December, ISO issued two new endorsements for contractors' CGL policies eliminating coverage for property damage arising out of their subcontractors' defective work. Pat Wielinski examines the history and explains the problem.
Another federal court of appeals has weighed in on the applicability of the ADA to design professions. Kenneth Slavens explains how the ADA liability exposure of a building designer depends on where the project is located, until a higher court rules on the issue.
In this article, Kent Holland explains that when arbitration is the main means of dispute resolution under a design-build contract, why it is so important for all parties to a design be subject to a single arbitration action.
What should the design professional do after witnessing unsafe job site practices by the contractor? Ken Slavens explains how different jurisdictions answer that question and what can be done to both prevent injury and protect liability.
Insurers may deny claims where a contractor, absent the filing of a lawsuit, repairs property damage caused by an obvious accident. Pat Wielinski discusses the scenarios, issues, case law, and provides practical pointers for avoiding this situation.
A complex court decision holds that a developer is entitled to recover its losses from the design-builder who employed the engineer and constructed the failed projects. J. Kent Holland Jr. explains its significance.
Unfortunately, insurance coverage disputes mirror casualty and liability losses throughout the world. This article examines recent litigation involving insurance coverage disputes and violent crimes and sexual assaults.
The "your work" exclusion of the CGL policy, together with its "subcontractor" exception, are the source of great contention in construction defect cases. This article looks at the question of whether coverage exists for property damage arising out of work or materials supplied by other than a traditional subcontractor.
The merits and failings of the economic loss doctrine as applied to the design professions have been continually debated. Learn how relatively recent court opinions have signaled further erosion of the protection that the doctrine provides.
Too often little attention is paid to exactly how coverage follows the various insureds from underlying policies into umbrella/excess layers. Learn three important points to review when coordinating coverage: the named insureds; the additional insureds; and insured-versus-insured provisions.
The gun violence public policy debate has moved into the courts where individual, class-action, and governmental plaintiffs are all seeking to hold firearms manufacturers and distributors legally liable for injuries caused by guns. Learn how the First Circuit court's unwillingness to view such claims as anything other than 'bodily injury arising out of your product' suggests that CGL coverage in such litigation will be hard to establish.
The proliferation of indoor mold and mildew problems—and resulting lawsuits—have sent many contractors scrambling for coverage under their insurance policies. This article discusses case law surrounding the issue, including whether mold is considered a "pollutant" and whether cleanup is covered under the CGL policy.
Blanket additional insured endorsements are useful tools for preventing administrative oversights and reducing paperwork, but they also carry risks for both the named and additional insureds. Discover methods contractors and subcontractors can use to minimize the risks of breaching their contracts when using blanket AI endorsements.
Over the past several years, courts have fashioned a new cause of action deriving from products liability cases when evidence is destroyed, lost, or altered: spoliation of evidence. Does the post-1986 ISO, CGL policy cover this loss? See why this author thinks so.
It is common for businesses to involve multiple corporate, partnership, and joint venture entities, and there are a number of subtle nuances that can effect how insurance coverage applies to these entities. Care must be taken to identify them and assure that insured status is properly provided under CGL policies. Learn how in this insightful article.
Fred Muse discusses as the lines of responsibility between design firms and contractors merge and contractors are assuming nontraditional risk whether their core insurance coverages are being addressed.
By their nature, defective work claims are often hotly contested. Even relatively simple claims cause confusion, resulting in inconsistent court opinions. This article examines the problem and suggests a comprehensive approach to determining the applicability of coverage to these claims.
The Fourth Circuit court has ruled the accrual provision in AIA 11.3 to be enforceable. The court held that the clause, which determines when the statute of limitations begins to run, is not against public policy.
Courts that confuse damages arising in "tort" with damages arising in "contract" overlook an important legal principle, as well as misuse the concept of "negligence" in the insurance context. The argument that concludes no coverage exists for breach of contract actions puts the cart before the horse. Jill Berkeley explains.
Despite standardized CGL policy language, courts around the United States have, at best, produced a mixed bag of results in applying the definition of 'occurrence' to faulty workmanship. This article reviews the two most prevalent types of analysis used by the courts, and why they lead to very different coverage interpretations.
Use of the additional insured and the hold harmless clause approach without some other modifications to the CGL policy can result in a risk being ineffectively transferred or not transferred at all, contrary to the expectations of the parties. Richard Rudolph explains.
ISO has revised the CGL insuring agreement to address "known loss" issues raised by the California Supreme Court in Montrose Chemical v Admiral. Find out how significant the new restrictions on coverage are.
Patrick Wielinski reviews the move away from using the traditional property damage exclusions as a basis to deny coverage for defective work claims to using the definitions of "occurrence" and "property damage," together with the insuring agreement.
Learn about the scope of coverage under the project management protective liability (PMPL) policy and how it compares with the more traditional methods of insuring against liability arising out of construction projects.