Property Damage To Your Work Exclusion

For many years, the standard General Liability policy form, when issued to a contractor, has had exclusion L. which takes away coverage for lawsuits alleging property damage to the contractor’s work arising out of such work.


However, the policy language makes an exception and gives back coverage for such property damage lawsuits if the damaged work was performed on behalf of the insured contractor by his subcontractor. In other words, this property damage exclusion does not apply to a builder that subs out its work. This meant that the General Liability policy provided much broader coverage to a general contractor as opposed to a subcontractor.


But, around 2004, most insurance carriers that provided General Liability policies for builders, started adding Exclusion CG2294 or a similar endorsement to the policy. This takes away the special coverage exception for general contractors such as builders and leaves them without important coverage for property damage to their work.