When the contractor kinks the water supply line

Coverage Q&A: Do ‘your work’ exclusions apply after a painter breaks a waterline?

This week’s coverage Q&A looks at liability for water damage caused by painting contractors. (Credit: Zastolskiy Victor/Shutterstock.com)

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Editor’s Note: If we had a dollar for every question that comes up surrounding the application of the property damage exclusions for “your product” and “your work,” especially with respect to contractor work, we could probably wallpaper our entire office with them. This week’s question is one more example that will help explain the application of the “your work” property damage exclusion when a painting contractor accidentally kinks the water supply line to the refrigerator in a condo building.

Question: We write a contractors liability policy under the CG 00 01 12 04 Coverage form. The insured had installed flooring and painted a wall in a kitchen of a condo. They pulled the refrigerator out, painted the wall behind it, and then put the refrigerator back. In pushing the fridge back, the supply line to the fridge kinked and broke. Water leaked from the supply line and damaged the recently installed floors, the drywall behind the fridge and water damaged the two units below this condo.

What coverage will the liability form provide?

All members of our management team agree that the contractors liability policy should cover the damages to two units below the unit where work is being performed. Covering the damages to the unit and the work just completed by the contractor is where we have differing opinions on applying coverage.

Some members think that the work on the floors and paint on the walls was completed, and then should be covered as well. Other members cite the property damage exclusion (j) (5), and the “your work” exclusion. They think that since the insured was working on the paint and floor in that area, and damages occurred to those areas in the course of the insured’s work, that the policy should not cover the flooring or paint. However, in the event the cabinets and drywall were damaged, they opine that that should be covered.

How should coverage properly be applied in this scenario?

— Kentucky Subscriber

Answer: In short, only the required repainting and the lost paint from the initial job are not covered by the exclusion for “your work.” The purpose of exclusion j.(5) is to prevent the commercial general liability (CGL) coverage form from guaranteeing the quality of the named insured’s work. Thus, if there is damage to the named insured’s work, the CGL form will not cover that damage. However, if the work injures someone or damages another’s property, then the CGL form will respond to that claim. Since the insured’s work damaged the drywall and flooring, those damages should be covered.

You may find the following article of benefit in understanding these exclusions in the CGL: Faulty work and products claims “your product” and “your work” exclusions.

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