Completed Operations Liability

What is Completed Operations Liability​?

Completed operations liability is insurance coverage that protects contractors, artisans, and service providers against third-party bodily injury or property damage claims occurring after a project is finished or work is abandoned. It applies to work completed away from the business premises, covering defects in workmanship, installations, or repairs.

Key Aspects of Completed Operations Liability:
  • Coverage Scope: Covers legal defense costs, damages, and settlements resulting from accidents caused by finished work.
  • When it Applies: It triggers once the job is completed, put to its intended use, or the contractor leaves the site.
  • Common Examples:
    • A plumber installs a pipe, and it bursts a month later, causing water damage to a home.
    • An electrician installs faulty wiring that causes a fire in a building several months later.
    • A deck built by a contractor collapses, injuring homeowners six months after completion.
  • Difference from General Liability: While often bundled together, general liability covers accidents during the job, whereas completed operations covers accidents after the job.
  • Exclusions: It typically does not cover the cost of repairing or replacing the faulty work itself (that is usually covered by a contractor's Builder's Risk or similar policy), but it covers the damage the faulty work caused to other property.
  • Who Needs It: Contractors, subcontractors, plumbers, electricians, HVAC installers, cleaning services, and other trades. 

This coverage is crucial for ensuring that a business is not held financially responsible for damages that appear long after they have left a job site. 
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