In a Florida case, the state's Supreme Court found that who owed what in a claim depended on the cause of the underlying loss. When a contractor built a million-dollar home for a Miami owner, a subcontractor was retained to install the windows. All of the windows the subcontractor installed were manufactured by a window company. After moving into the house the owner found that the windows leaked. He sued the general contractor, the subcontractor and the window manufacturer. The general contractor repaired or replaced all the windows and settled an additional water damage claim with the homeowner. The manufacturer settled with the general contractor, obtaining the general contractor's rights against the subcontractor and the general contactor's own insurance company.
 
The manufacturer then made a claim against the general contractor's liability insurer. The insurer denied the claim on the basis that the loss did not constitute "property damage" within terms of the policy contract for other than the water damages. The manufacturer proceeded to file suit in federal court. The Fifth Circuit certified questions to Florida's Supreme Court as to whether the post-1986 standard Commercial General Liability policy provides coverage for repair or replacement of a subcontractor's work. The Florida court answered that if the subcontractor properly installed windows that were already defective, there would be no coverage, but if the subcontractor improperly installed non-defective windows, coverage would apply. Although not discussed by the court, if the general contractor had been an additional insured under the subcontractor's policy, the dispute might have ended quite differently. 
 
One of the most common sources of insurance litigation in the 21st century is the status of "additional insureds" under various types of general liability forms where products or completed operations claims are involved. Adjusters must be familiar not only with the circumstances of the loss, but also the wording of any "additional insured" endorsements and the applicable legislation and court cases in the jurisdiction where the loss occurs. Crawford Educational Services courses teach how to understand these endorsements and legal decisions. For complete course listings, visit our website.