Masonry Magazine June 1968 Page. 5
WHAT NOT COVERED.
by Walter T. Derk-MCAA Insurance Consultant
A series of articles composed of a concise summary of principal hazards excluded or omitted from the newly revised liability insurance policies. Designed to bring the fine print into better focus.
MASONRY is pleased to be able to bring you this second series of articles on insurance by Walter T. Derk, MCAA's Insurance Consultant. Mr. Derk's book, "Insurance For Contractors," is now in its fourth printing with over 30,000 copies in circulation.
PART II
COMPREHENSIVE GENERAL LIABILITY
THE BASIC POLICY
When asked to determine coverage for a particular exposure, most underwriters consider three aspects of the policy in order, (1) the insuring agreements, (2) policy definitions and then (3) the exclusions. If the first two tests are passed and there is no specific exclusion, coverage exists. We shall follow the same course here.
INSURING AGREEMENTS
This determines the subject matter and limits the scope of what we are talking about, immediately answering many of the coverage questions which come up. The new Bureau Comprehensive General Liability policy agrees to pay as damages because of bodily injury or property damage "to which this insurance applies, caused by an occurrence .". A very broad statement indeed, and a simple one. In this context, however, we shall treat it as a limitation, since we now know that this policy is not going to pay for anything other than a legal obligation for bodily injury or property damage.
Example No. 1
Company A sold B a product which did not function properly, resulting in lost production time and sales. No coverage; there is no bodily injury or property damage. Practical Solution: None. A business expense best borne (by Company A) as such.
Example No. 2
One of Company A's employees improperly operated their crane, damaging it against Company B's wall next door. No coverage for the crane (one has no legal liability to one's self), but damage to B's wall is covered. Practical Solution: A separate Equipment Floater policy on the crane.
POLICY DEFINITIONS
These formally define, and therefore limit, the key words used throughout the policy and endorsements. To repeat all of the definitions here would be an obvious mistake they are no fun to read at all, being highly compact, technical and proper. Every comma is important enough to change the meaning to some extent, precluding paraphrasing within a reasonable amount of space. The list includes:
Automobile
Bodily Injury
Collapse
Completed Operations
Contractual Liability
Damages
Elevator
Explosion
Incidental Contract
Insured
Insured Premises
Medical Expense
Mobile Equipment
Named Insured
Named Insured's
Products
Occurrence
Policy Territory
Products Hazard
Property Damage
Suit
Underground Property Damage
Work
Using this list, we can refer to the policy jacket and coverage parts for reference as kind of a dictionary if needed. All of the definitions are potentially important, but we shall dwell on only a few here, then use examples to better illustrate the majority of them.
Occurrence
The new definition of an occurrence is worthy of quotation, being "an accident, including injurious exposure to conditions, which results, during the policy period, in bodily injury or property damage neither expected nor intended from the standpoint of the insured."
Note the interesting limitation here an insured occurrence is not just any pre-hippie happening, but an