Three million gallons of water was released following the collapse of a dam; killing seven people and causing property damage. The owner of the dam sued the prior owner because of the structural integrity of the dam. The prior owner sought coverage under its policy with James River Insurance who declined coverage because the Limitation of Coverage for Designated Premises or Projects Protected listed only the office location as being covered. The prior owner disagreed.

Click here to see how the court ruled.

The CG 21 44-Limitation of Coverage to Designated Premises or Project endorsement has been unchanged since 07/01/98 until 04/1/2017 when it grew from 113 words to 1,142 words. ISO's Release Notes explained that the endorsement was changed, partly, to address the courts' finding in the court case above.

Click here to read a brief explanation of the CG 21 44 change in the PF&M analysis.

The CG 21 44 is often used as a Bandaid to make an otherwise unattractive risk look attractive by attempting to convert the very broad commercial general liability coverage into a very narrow specific coverage form. When a significant loss, such as seven deaths and three million gallons of water, occurs the CG 21 44 might not prove strong enough to resist coverage. A better way may be to identify potential coverage gaps and find markets to cover the problem.

Click here to review a General Information Questionnaire of the Producer's Commercial Lines Risk Evaluation System that is an important tool to use in finding gaps.

The Producer's Commercial Lines Risk Evaluation System questionnaire takes time to complete but it sets you apart because of its thoroughness. It tells your client that you are interested in learning about its business so that you can make informed suggestions on coverages and that you can present your client to only insurance carriers who are prepared to provide the coverage and service needs your client needs. The upfront time in completing the form will save time in the years to come.

Click here to review a letter you might want to use in contacting a current client or a prospect about providing a risk management survey and then use the Producer's Commercial Lines Risk Evaluation System to guide you through the process.