“That Particular Part” Shouldn’t Be That Confusing
Construction defect coverage litigation has been declining over the years. The building booms of the late 80s and 90s resulted in a boom of construction defect litigation too. Coinciding nicely with the introduction of the 1986 ISO form policy with new wording, insurers found themselves paying for a lot of defective construction claims. Since then, coverage for construction has gotten harder to get, and a lot narrower. Insurers tightened down by introducing new – and more restrictive – versions of additional insured endorsements, by adding very restrictive versions of “Montrose” endorsements, and by ultimately by refusing to sell insurance to many contractors.
This decline in construction defect coverage litigation is probably due to both the end of the building boom, and also the fact that many of the issues have now been litigated all the way up to the top courts. Therefore many of the once disputed issues are decided: the scope of completed operations coverage; the meaning of “your work;” the alienated premises exclusions, and so on. But it was somewhat surprising (to me at least) that some carriers are now disputing the meaning of “that particular part,” as that phrase is used in exclusions J(5) and J(6) of the current ISO CGL policy. And interestingly, there are relatively few published court opinions across the nation that have interpreted these exclusions.
Click here to read the blog post on Policyholder Perspective.