Completed Operations and Your Work Exclusion

We insure a fertilizer dealer who also does some application of the fertilizer. The fertilizer dealer classification code, 12683, does state that it contemplates application of the product. The insured applied fertilizer on a crop and it has caused some damage to the crop and a definite reduction in yield. Is this a completed operation claim and would the your work exclusion on the CGL form apply?

South Dakota Subscriber

Presumably, the damage to the crop occurred after the insured was finished with his work; that is, the damage manifested itself after the application was finished and the insured left the area. This meets the definition of products-completed operations hazard in the CGL form in that the property damage occurred away from the premises of the named insured and arose out of his work which was completed; therefore, this is a completed operations claim.

In this instance, the your work exclusion (exclusion l. in the CGL form) would be the exclusion to note. This exclusion prevents coverage for damage to the insured's work arising out of the work itself. For example, if the insured built a retaining wall for his customer and the wall later fell down, the CGL form of the insured would not pay for rebuilding the wall.

However, in this instance, the work of the insured is not what was damaged. His work damaged someone else's property and that is a reason why the CGL form exists; the form is meant to provide insurance coverage for an insured that is responsible for damaging another's property. So, unless there is some other applicable exclusion, this claim for property damage will be covered by the CGL form.

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