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About Jay K. Williams, AAI, AIP, CIC, CRM
Expertise
I can answer questions relating to the following coverages: personal auto; homeowners; commercial auto; commercial liability; commercial property; business income and all other property and casualty coverages.

Experience
I have been in the insurance industry in Florida since 1979. I am currently the president of a Florida domestic insurance company subsidiary. I've taught continuing education classes in Florida and across the country. I am quite familiar with all coverages including Florida Condominium master policies and unit owner policies. I also specialize in agent professional liability. I have been a professional educator since 2001.

Organizations
I am a member of the Florida Associaion of Insurance Agents, the state affiliate of the Independent Insurance Agents and Brokers of America.

Education/Credentials
I currently carry the following professional designations: Accredited Advisor in Insurance (AAI) Associate in Insurance Production (AIP) Certified Insurance Counselor (CIC) Certified Risk Manager (CRM)

You are here: Experts > Money > Personal Insurance > Property & Casualty Insurance > Care Custody control

Property & Casualty Insurance - Care Custody control

Expert: Jay K. Williams, AAI, AIP, CIC, CRM - 11/4/2009

Question
I have a Contractor who installed cabinets in a business office, the office copy machine was in the way so he pulled it from the wall and when finished an hour later moved it back.He did not unplug it. The copy machine apparently brand new never worked gain and was deemed "fried" from the copy mfg as a result of some short when the unit was moved . The insureds Gl carrier is denying coverage under the CCC exclusion. Can you explain ?

Answer
Hi Christy,

The CCC exclusion should only apply to that part of the premises that the insured is actually working on. Here's the exact language from the 2007 ISO CGL:
(4) Personal property in the care, custody or control of the insured;

(5) That particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the "property damage" arises out of those operations;

This exclusion is limited to the actual property the insured is there to work on. In your case, the cabinet installer was not there to work on the copier. Moving the copier was just incidental to the work he was actually there to perform. This is why coverage is commonly referred to as "Broad Form Property Damage."

The intent of the exclusion is to eliminate coverage for bailment situations, where the insured is actually taking possession of someone else's property. The carrier has incorrectly denied coverage based on the exclusion. In multiple case law situations, the courts clearly state that when an insured is granted temporary access to perform work (in this case your insured had temporary access to the copier in order to move it), the property is not in the CCC of the insured since the access is only temporal. Clearly, if your insured was there to work on the copier then coverage would be denied.

The bottom line is this: the company adjuster is incorrect and the claim needs to be paid.

Please let me know if you have more questions.

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