CG 20 37 Endorsement – Additional Insured Coverage for Completed Operations
Getting insurance coverage right is a nuanced process, especially when dealing with completed operations. The CG 20 37 endorsement is a common tool to navigate this complexity.
TL;DR
- The CG 20 37 Endorsement grants additional insured status for completed operations.
- It matters to agencies because it is a common request in construction and manufacturing contracts.
- A common mistake is confusing “ongoing operations” coverage with “completed operations” coverage.
- Agencies can reduce risk by verifying each contract’s insurance requirements and reviewing the relevant policy forms.
What Is the CG 20 37 Endorsement in Insurance?
For clients, the CG 20 37 endorsement simply means adding someone to an existing policy to provide coverage for losses that occur after work is completed. The term “completed operations coverage” refers to damages or injuries that may happen later due to work done, even after the job’s completion.
The CG 20 37 Endorsement, sometimes referred to as a form cg2037, extends additional insured coverage for “completed operations”. This can be found on the endorsement page of a Commercial General Liability (CGL) insurance policy. It generally comes into use in construction and manufacturing sectors where work result may cause damage or injury after completion.
Key Related Terms to Know
- CG 20 37 07 04: This is a particular version of the CG 20 37 endorsement.
- CG 20 10: An endorsement that provides coverage for ongoing operations, which is distinct from completed operations.
- CG 2037: The shorthand for CG 20 37, an endorsement that covers completed operations.
- Ongoing Operations: The work in process.
- Completed Operations: Work that has been completed.
- Additional Insured Endorsement: An amendment that grants another party insured status on someone else’s policy.
- Construction Defect Claims: Claims related to deficiencies in construction work.
Common Questions About the CG 20 37 Endorsement
Do we need both CG 20 10 and CG 20 37 endorsements?
In construction projects, it’s pretty common to require both the cg 20 10 and cg 20 37 endorsements. The CG 20 10 covers the “ongoing operations” part of the project, while cg2037 covers the “completed operations”.
How does the CG 20 37 07 04 differ from the CG 20 37 04 13?
The numbers signify different edition dates. The differences between the two forms usually relate to the language of the endorsement, changes in coverage limitations, and exclusions.
What is the downside of not having a CG 20 37 endorsement?
Without a cg 20 37 endorsement, clients may find themselves without coverage for any loss or injury that arises after the project is completed. For example, if a light fixture falls and injures someone after the electrician has completed work and left the premises, there would be no coverage without a completed operations endorsement.
Is CG 20 37 only for CGL policies?
The CG 20 37 endorsement is specifically designed for Commercial General Liability (CGL) policies. It is useful for businesses where their finished product or completed work could potentially lead to liability after the operations have finished.
CG 20 37 Endorsement vs. CG 20 10 Endorsement
The main difference between the CG 20 37 and the CG 20 10 is the coverage timing. CG 20 37 provides protection after job completion, while CG 20 10 focuses on ongoing operations.
Comparison Area | CG 20 37 Endorsement | CG 20 10 Endorsement
|
Primary Use Case | Covers liability for completed work | Covers liability during ongoing work |
Coverage Concept Type | Completed Operations Coverage | Ongoing Operations Coverage |
Typical Exclusions | Does not cover ongoing operations | Does not cover completed operations |
Most Affected by Errors | Construction Contractors | Construction Contractors |
Common Mistakes | Mistaken for CG 20 10 | Mistaken for CG 20 37 |
Real Claim Examples Involving the CG 20 37 Endorsement
Scenario 1: A construction company built a house, and a year later, the owner claimed a loose railing caused injury. The construction company’s CGL coverage with the cg 20 37 endorsement covered this loss, irrespective of policy expiration date, as the accident happened after completion of the work.
Scenario 2: A manufacturer produced bicycle parts. A cyclist was injured when the brake parts failed after a year of use. Since the manufacturer had a CG 20 37 endorsement on their CGL policy, they were covered for the claim.
Scenario 3: An electrician installed lighting fixtures in a home. A fixture malfunctioned after work was completed, causing a fire. The homeowner’s insurance company made a liability claim against the electrician. Thanks to the CG 20 37 endorsement on the electrician’s CGL policy, the claim was covered.
Limitations and Common Mistakes
- Assuming “ongoing operations” and “completed operations” are inherently covered in liability insurance policy.
- Forgetting that endorsements like CG 20 37 or CG 20 10 are at times required and must be requested.
- Overlooking the fact that extending additional insured status can potentially deplete the policy limit.
How to Explain the CG 20 37 Endorsement to Clients
For personal lines client: Think of the CG 20 37 like this: Imagine if you hired a contractor to build a roof. Six months later, a poorly installed tile falls and injures someone. This endorsement would cover the cost of that injury claim.
Small Business owners: You know how when you make products, there’s a chance something could wrong after they left your hands? The CG 20 37 is there to cover such incidents. It keeps protecting you, even after your work is technically done.
CFO or Risk Managers: The CG 20 37 endorsement is a vital part of the risk management process, particularly in manufacturing or construction. It extends coverage to cover the liability coming from your completed work.