The insurer is denying coverage based on the damage to your product exclusion and damage to your work exclusion. What are your thoughts on this?

New Hampshire Subscriber

The your product exclusion is not applicable. A modular home is real property and all parts that make up that home are real property. Once the various parts that make up a home are assembled and made into a complete home, the parts are real property and no longer individual business personal property pieces or products. The damage to your product exclusion does not apply to real property since, by definition, your product does not include real property.

As for the your work exclusion, that applies to property damage to the work of the named insured arising out of that work. The exclusion does not apply to damage to other property caused by the insured's work. In this instance, if the faulty work was the insulation, the exclusion means that the CGL form will not pay for fixing the faulty insulation; that is, the general liability policy will not pay for damage to the insulation if the damage was caused by the insured's work. But, if that faulty insulation work caused the water pipe to freeze and break and this resulted in damage to another's property, the exclusion does not apply to that damage.

This exclusion is not worded very well and is not easily understood, but the bottom line is this: if there is damage to the insured's work that arises out of his work, the CGL form won't apply; it will not act as a guarantor for the quality and fitness of the insured's work. If the insured's work causes damages to another's property, that is covered by the CGL form. The dividing line here may be very thin and each situation has to be judged on its own circumstances, but the exclusion has to be applied narrowly, and the insured is entitled to the benefit of any reasonable doubt.