Requires that definition of occurrence in certain property damage liability insurance policies include coverage for faulty workmanship.
Impact
If enacted, A599 will significantly influence the state’s commercial liability insurance regulations. It will prevent the delivery, issuance, execution, or renewal of liability insurance policies that do not align with the updated definition of occurrence outlined in the bill. This change is expected to provide better protection for contractors and construction professionals, as it clarifies the insurance coverage they are entitled to in the case of damage claims related to their work. Ultimately, the bill reinforces the importance of adequate coverage for risks that are inherent in construction projects, which could lead to fewer claims denied and improved industry standards.
Summary
Assembly Bill A599 aims to amend the requirements for commercial liability insurance policies by mandating that these policies include a specific definition of 'occurrence' to cover instances of faulty workmanship. This legislation seeks to enhance clarity and certainty for contractors and construction professionals regarding their insurance coverage, particularly in cases where damages arise from repetitive exposure to harmful conditions or result directly from poor workmanship. By enforcing this requirement, the bill intends to minimize disputes over insurance coverage in the construction industry, where such ambiguities have often led to litigation.
Contention
There may be some contention surrounding A599, particularly from insurance providers who might resist the requirement to define occurrence in a manner that obligates them to cover faulty workmanship. Critics may argue that this could lead to an increase in insurance costs or further complicate the underwriting process. Furthermore, there could be concerns regarding how broadly the 'faulty workmanship' term is interpreted, potentially resulting in increased claims that insurers may find problematic. Nonetheless, supporters of the bill argue that greater coverage will lead to a healthier construction industry and better overall outcomes for consumers.
An Act Concerning The Assignment Of Post-loss Homeowners And Commercial Property Insurance Benefits, Consumer Bill Of Rights And Revising Disclosure Requirements For Home Improvement Contractors And Salespersons.