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This ruling appears to be a significant broadening of the CGL insuring agreements. If this stands, Indiana insurance companies will need to reprice the CGL product for the increased exposure for loss. The comment that a performance bond is the correct instrument to use to guarantee the proper completion of a subcontractor's work is right on target. These bonds have had rates approved by the various state insurance departments, are properly written, and have been court tested. It would appear that the 3 majority judges did not have an clear understanding of the difference between the CGL insurance product and the surety product. We can only hope this ruling it is overturned on appeal.

Deficient workmanship is always foreseeable. It is a known and identifiable risk; therefore, cannot be considered an accident. Performance bond is the proper mechanism to address this issue/risk.

As a sub I was looking for a remendy when a process I was using for coating a new concrete floor went horribly wrong, I ask my insurer who is also a good friend if I could file a claim to repair the floor, much the same as if I spilled material on a new carpet or ruined cars with overspray. His answer, no because what happened to the concrete was more on the line of malpractice insurence, which I couldnt afford. Insuring malpractice is already available and maybe insurers could offer it, but it seems to me it would reduce the compentency of trades and the need for self discapline. As much as I wouldve like the cost of a process gone wrong...end of the day...live learn..get better.

EDIT__As much as I wouldve like the cost of a process gone wrong TO BE COVERED BY INSURENCE.....end of the day...live learn..get better.

GC's function is to assume all risk of workmanship from owner. It is up to GC to mitigate that risk through better sub selection, supervision, testing, bonds etc.. Better legislation is needed to avoid these bench rulings which will only serve to drive up construction costs.

And what happens when the sub's defective work (say a leaky roof) causes damage to other trades' work (drywall, paint, electric, HVAC)? This is the distinction most courts have drawn when they allow coverage for defective work (to the "other damaged property") and it's a good one in my view.

Whenever a man's friends begin to compliment him about looking young, he may be sure that they think he is growing old.

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