ISO PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE FORMS OVERVIEW

(July 2024)

INTRODUCTION

The Insurance Services Office (ISO) Products/Completed Operations Liability Coverage Forms provide coverage for damages that result from bodily injury and property damage within the products/completed operations hazard. It is often used when the products/completed operations exposures are considered too risky for general insurance carriers, so are written separately. CG 21 04–Exclusion–Products/Completed Operations Hazards is attached to the applicable standard CGL coverage form when the products/completed operations are excluded. A different insurance company would then write this exposure on a stand-alone policy.

This coverage can be written on either an occurrence or claims-made basis and is subject to certain definitions, exclusions, and limitations.

ELIGIBILITY

The eligibility criteria for either of the ISO Products/Completed Operations coverage forms is very broad and applies to all commercial exposures. Some limitations apply with respect to certain classes or exposures that are not eligible to be included in commercial package policies or for the package policy premium discount. However, there are no limitations on using the coverage form itself.

ISO PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE FORMS

These sections appear in both CG 00 37–Products/Completed Operations Liability Coverage Form (Occurrence Basis) and CG 00 38–Products/Completed Operations Liability Coverage Form (Claims-Made Basis).

Section I–Coverages–Products/Completed Operations–Bodily Injury and Property Damage Liability contains the insuring agreement, exclusions, and supplementary payments.
Section II–Who Is an Insured, describes the parties eligible for insured status.
Section III–Limits of Insurance, explains how each limit of insurance applies and how they relate to one another.
Section IV–Products/Completed Operations Liability Conditions describes the specific conditions that apply to Products/Completed Operations coverage. A number of them involve the named insured's post-loss responsibilities. In some cases, coverage can be voided by condition violations.
Section V–Definitions (Section VI in CG 00 38) describes certain words and phrases used with and related to the coverage provided. These definitions should be carefully reviewed to determine if coverage applies.

OCCURRENCE COVERAGE FORM VERSUS CLAIMS-MADE COVERAGE FORM

There are two separate coverage forms. CG 00 37–Products/Completed Operations Liability Coverage Form is written on an occurrence basis. It covers losses that occur during the policy period, regardless of when the insurance company is notified of the loss or claim. The key to this coverage approach is the occurrence’s date of loss.

CG 00 38–Products/Completed Operations Liability Coverage Form is written on a claims-made basis. Coverage is triggered by the actual filing date or receipt of the claim. It responds to any covered loss or claim filed during the policy period, regardless of when the actual loss or injury occurred as long as it occurred after the retroactive date on the declarations and prior to the policy expiration date.

POLICY MAKE-UP

Policies providing Products/Completed Operations Liability Coverage must include the following forms:

IL DS 00–ISO Common Policy Declarations
IL 00 17–ISO Common Policy Conditions. This form contains the conditions common to most commercial insurance coverage forms and is mandatory for use with most ISO mono-line or multi-line simplified policies.

Related Article: IL 00 17 Common Policy Conditions

CG DS 05–Products/Completed Operations Liability Declarations.

CG 00 37–Products/Completed Operations Liability Coverage Form (Occurrence Basis)/CG 00 38–Products/Completed Operations Liability Coverage Form (Claims-Made Basis).

Policy Cover Page or Jacket. This form is designed by individual insurance companies for their own purposes and may include a table of contents or index to meet the requirements of some states.

AVAILABLE ENDORSEMENTS

A variety of endorsements are available to tailor the ISO Products/Completed Operations Liability Coverage Forms. Some endorsements are mandatory and required for specific classifications and types of business. Others can be used to customize a standard form to match the coverage requirements of a specific risk.

UNDERWRITING

Underwriting products and completed operations hazards for a specific risk or prospect involves identifying and evaluating its exposures and then properly classifying both the risk and its exposures.

RATING

Rating products and completed operations liability coverage, as prescribed in the ISO General Liability Manual and the ISO Classification Manual, is very specific and can be confusing.