Property Damage Involving Work Product

Damage to the Named Insured’s Product
If the named insured’s product is damaged or destroyed because of the product or parts of the product, there is no coverage for the damage to the product; however, there could be coverage for the damage that the product caused to other property.

Damage to the Named Insured’s Work
If the named insured’s work is damaged, there is no coverage UNLESS a subcontractor working for the named insured caused the damage.
Note: This important exception is being eliminated by some carriers.

Damage to Impaired Property
Impaired property is defined as tangible property, other than the insured’s product or work, which cannot be used or is less useful because it incorporates the insured’s product or work which is known or thought to be defective, deficient, inadequate, or dangerous. Impaired property also occurs because the insured has failed to fulfill the terms of a contract or agreement. The property must be able to be restored to use by the removal of the insured’s product or work, or by his or her fulfilling the terms of a contract or agreement.

There is no coverage for property damage when property becomes impaired due to the actions of the named insured. However, this exclusion does not apply to the loss of use of other property arising out of sudden and accidental physical injury to the insured’s product or his or her work after it has been put to its intended use.

Loss of Use, Withdrawal, Recall
The policy does not cover damages claimed for expenses incurred by the insured or others for the loss of use, withdrawal, recall, inspection, repair, replacement, adjustment, removal, or disposal of the insured’s product or work or impaired property, if such has been recalled because of a known or suspected defect, deficiency, inadequacy, or dangerous condition.