A coverage not often addressed in conversations about general liability insurance is called “products—completed operations.” This important coverage is primarily understood to cover claims involving defective products that have been made and sold. But it also covers work once it has been completed and has been put to its intended use.
You will commonly see “completed operations” referenced in certificate requirements in contracts. Complying with this request in your contract can leave you open to uninsured exposures. That is because “completed operations” additional insured coverage is not the same as “ongoing operations.” For example, if an electrical contractor is actively working on a house that has not been occupied by the owners and a fire occurs due to the electrician’s work, this is an ongoing operations claim. But if the work has been completed and the owners now reside in the home and a fire occurs for the same reason, this is a completed operations claim.
Check with your insurance professional to see if you are covered for both types of loss. If not, you may wish to amend your insurance policy or prevent these exposures in your work contracts.
