Did you know that you can essentially be your own exclusion from insurance coverage? As part of our Did You Know series and an extension of our previous article on "Time To Tender," we felt it was equally as important to address another frequent exclusion beyond failure to tender timely, aka put your insurance carrier on notice of a potential claim within the time frame set forth in your policy. (Beware - it's very short!)
Your insurance coverage has what is often referred to as a "your work" exclusion - meaning that if an aspect of your work is defective or there is an issue with it, your carrier won't pay out for corrective action. In other words, "your work" is excluded from coverage.
However, and even more interestingly, if "your work" causes damage to other property, then under certain circumstances, your coverage may kick in. For example, if you install windows incorrectly in a home, your carrier likely won't pay for them to be ripped out and replaced. However, if water intrusion results from the faulty installation, causing water to drip onto the hardwood floors beneath and subsequent damage, then there is an added layer beyond just "your work" that may trigger coverage. I know - it almost seems backwards; why would anyone want more damage?
We draw from real world situations that we unfortunately, see contractors face regularly. The 1) time to tender and the 2) "your work" exclusions are the two most common reasons carriers deny contractors coverage.
Now you know about two key exclusions. No one has time or wants to read about insurance, but check your specific policy to see how it reads on these two points. Know your exact time to tender and language regarding "your work." Know the standard to which you're held so that you can conform, and it may impact your dealings with customer and on job sites.
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