What states are construction defect states?

Several other states have taken California’s lead in making construction defect litigation a growing industry, especially in the Western United States. There has been an surge of construction defect litigation in Arizona, Nevada, Oregon, Utah, Colorado, New Mexico, Minnesota, Florida, the Carolinas and Texas.

Are construction defects insurable?

The Important “Your Work” Exclusion Thus, in a jurisdiction that recognizes that construction defects can be an accidental “occurrence,” a general contractor generally will have coverage for property damage caused by the work of its subcontractors.

Does general liability insurance cover construction defects?

General liability protects contractors from third-party claims for bodily injury or property damage, and many contractors assume that this coverage includes faulty workmanship and other construction defects.

Is California a construction defect state?

It normally only applies under statute or in remarkable situations. And it does exist in California for one type of construction defect: defects in residential property. The builder is strictly liable for the construction defects existing in a residential property only.

What are the categories of building defects?

Common types of Building Defects

Non-structural cracks. Hair-line cracks.
Spalling of concrete. Stains of water or rust are found on the surface or there is seepage of water.
Structural cracks. Cracks that penetrate the surface rendering into the structural concrete or load-bearing brick wall.
Defective external wall finishes.

Does a GL policy cover faulty workmanship?

A general liability policy is not a warranty against your work. So it’s not surprising that damage resulting from defective workmanship, incorrect installation, or faulty materials is generally excluded.

What is the statute of limitations for construction defects in California?

The California statute of limitations for breach of contract and breach of implied warranty is two years for oral agreements and four years for written ones.

How long is a contractor responsible for his work in California?

In accordance to California civil law, the contractor is liable for a stated minimum standard of construction for 10 years after building even if the house has been sold to new owners. However, certain defects can only be claimed for 1 or 4 years after completion.

Can the contractor be liable for defects after the defects liability period?

Usually, yes. A contractor will normally remain liable for defects after the defects liability period has expired.

Does my insurance cover faulty construction?

Unfortunately, many faulty work claims aren’t covered by a standard general liability policy. If you are a contractor, you should understand what types of claims are likely to be covered by your liability insurance and which are not. Faulty work claims generally derive from complaints about the way a job was done.

Does your contractor insurance cover construction defects?

Insurance Coverage for Construction Defects. Contractor liability insurance coverage in construction defect cases is a matter that is hotly litigated. On the one hand, coverage often exists when a defect causes harm to a third party’s property. On the other hand, if the only harm is to the insured contractor’s defective work itself, there is usually no coverage.

Does a contractor’s liability insurance cover defective work?

In the context of construction defect litigation, one area where the interests of contractors and owners often align is the ability of the contractor to obtain insurance coverage through its liability insurance carrier for alleged defective work. Virtually all business entities maintain commercial general liability insurance coverage (CGL).

Does your insurance cover defective workmanship?

The straightforward exclusion cases are the ones where a homeowner tries to collect on insurance to cover the fixing of faulty workmanship. For example, if the roof was installed incorrectly and slides off the house, a straightforward reading of the policy will show that the insurance won’t cover putting on a new roof.