Courts Weight Insurance Coverage for Defective Construction
Two federal courts offer guidance on insurance coverage for defective construction claims, writes attorney Ronald L. Kammer.
September 24, 2015 at 02:50 PM
6 minute read
Construction litigation is booming, and two recent decisions potentially broaden coverage for builders who are sued for defective construction.
In Carithers v. Mid-Continent Casualty, the U.S. Court of Appeals for the Eleventh Circuit expanded what constitutes covered property damage. Before, there was a bright-line rule that defective construction was not property damage but damage caused by defective construction was property damage.
This is an important distinction for contractors since an insured's own defective work is not property damage and therefore not covered by insurance. Only damage caused by defective work was property damage and covered by insurance.
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