Nebraska Supreme Court Rules That Liability Policy Does Not Cover Faulty Workmanship Where Only Damage Is To Insured’s Work Product
09.28.16
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(Article from Insurance Law Alert, September 2016)
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The Nebraska Supreme Court ruled that a general liability insurer has no duty to provide coverage for the costs of remediating faulty workmanship where there is no damage to property other than the insured’s own work.
Drake-Williams Steel, Inc. v. Continental Cas. Co., 83 N.W.2d 60 (2016). The court explained that liability policies are not intended to protect against “business risks,” which include expenditures made to correct a policyholder’s own defective work. The court explained that coverage may be implicated where faulty workmanship has allegedly caused damage to other structures or property, separate and apart from the insured’s own work. As discussed in previous Alerts, courts across jurisdictions employ a variety of approaches in evaluating whether faulty workmanship claims fall within the scope of general liability coverage.
See June 2015 Alert;
May,
October and
December 2013 Alerts;
February 2011 Alert;
April 2010 Alert.