Navigating Project Peace: Completed Operations Insurance

What Is Completed Operations Insurance?

Completed Operations Insurance protects your business from claims that arise after a project has been finished and handed over. Even when your work is completed, unexpected issues can appear months or years later — causing property damage or injuries linked to your past work. This insurance steps in to cover those long-tail risks so your business isn’t financially exposed.

For contractors, manufacturers, installers, and service providers, this coverage is essential because many problems don’t surface while work is in progress. Instead, they show up later — when you are no longer on-site and long after the job is “done.”

Why It Matters

Even high-quality work can fail due to hidden defects, material issues, installation errors, or unforeseen weaknesses. When that failure causes harm, your business may be held legally responsible.

Completed Operations Insurance helps protect you from:

• Costly lawsuits

• Medical expenses related to injuries

• Property damage caused by past work

• Legal defense fees

• Settlement or judgment costs

Without this coverage, one incident could wipe out years of profit.

What Completed Operations Insurance Typically Covers

This coverage usually applies to:

1. Bodily Injury

If someone is injured due to a defect in your completed work — for example, a railing you installed collapses months after installation — the policy can cover medical costs and legal expenses.

2. Property Damage

If your finished work causes damage — such as faulty wiring leading to a fire — the insurance can cover repair costs, replacement expenses, and related liabilities.

3. Legal Defense

Even if a claim is unfounded, defending yourself in court is expensive. Completed Operations Insurance helps cover attorneys, investigations, expert witnesses, and settlement negotiations.

4. Long-Tail Liability

Some states allow claims many years after project completion. This insurance helps you stay protected throughout those time frames.

What It Does Not Cover

It’s important to understand limitations so you’re not caught off guard.

1. Repairing Your Own Faulty Work

If the issue is due to your own workmanship error, the insurance does not pay to redo your work.
It only covers damage caused by the faulty work, not the cost of fixing the defective work itself.

2. Expected Maintenance or Wear and Tear

Normal deterioration, negligence, or lack of maintenance by the property owner is not covered.

3. Damage to Your Own Tools or Equipment

This coverage only applies to third-party property damage or injuries — not your own work materials or equipment.

4. Intentional or Knowingly Improper Work

If there was intentional negligence or knowingly poor workmanship, the policy will not respond.

Who Needs Completed Operations Insurance?

This insurance is crucial for:

• General contractors

• Subcontractors

• Electricians

• Plumbers

• HVAC technicians

• Roofers

• Carpenters

• Landscapers

• Installers and repair professionals

• Manufacturers whose products may cause harm after installation

Any business whose work could cause future harm or property damage should carry this coverage.

Real-World Examples

Example 1: Plumbing Failure

A plumber completes a job, and months later a hidden connection fails, flooding the customer’s home.
Completed Operations Insurance can cover the resulting water damage and legal claims.

Example 2: Defective Installation

A contractor installs cabinets that fall six months later, injuring someone.
Medical bills and liability claims can be covered.

Example 3: Electrical System Malfunction

An electrical contractor’s completed work later causes a fire.
Damages, repairs, and legal defense costs may be covered.

How Long Does Coverage Last?

Coverage duration depends on:

• The insurance policy terms

• The state’s statute of repose (often 5–10 years)

• The nature of the project

This means your business can remain protected for years after the job is finished.

Frequently Asked Questions

Is Completed Operations part of General Liability Insurance?

Yes, but only if included as a specific coverage extension. Not all general liability policies automatically include it.

Does this insurance cover product manufacturers?

Yes. If your product or installation causes damage after delivery, the policy can respond.

Do I need this if my projects are small?

Yes — even small jobs can lead to large claims if something goes wrong later.

Does it cover mistakes I made in the work itself?

No. It covers damage caused by your mistake — not the cost of redoing the work.

Final Thoughts

Even when your work is flawless, unexpected issues can still arise long after a project is completed. Completed Operations Insurance gives you peace of mind, financial protection, and the ability to take on projects without fear of long-term liability.

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