Products-completed operations

How it works

General liability covers two broad kinds of risk. One is what happens at your premises or while you’re doing the work. The other is what happens later, because of work you’ve finished or products you’ve made or sold. That second part is products-completed operations.

It typically applies to bodily injury or property damage that happens away from your premises and comes from your completed work or your products once they’ve left your hands. Work is generally treated as completed when the job is done, or when the part of it that caused the harm has been put to its intended use.

Many general liability policies give products-completed operations its own aggregate limitAggregate limitAn aggregate limit is the most a policy will pay for all covered claims combined during one policy period, no matter how many claims you have.Read the definition, separate from the general aggregate. It typically doesn’t pay to redo or replace your own faulty work. It’s aimed at the injury or damage that faulty work causes to people and to other property, subject to the policy’s terms and exclusionsExclusionAn exclusion is a provision in an insurance policy that removes coverage for specific causes, types of loss, property or activities the policy would otherwise cover.Read the definition.

Who it matters to

Contractors and trades are the obvious case, since a leak, a fire or a collapse can surface months after the crew has left. It also matters to restaurants and retailers, because food and products you sell can hurt someone after they leave your counter. General contractors and clients often ask for additional insuredAdditional insuredAn additional insured is a person or company, such as a landlord or client, added to your liability policy so it can protect them from claims tied to your work.Read the definition status that includes completed operations, not just work in progress.

Why staying insured matters

Most general liability is written as an occurrence policyOccurrence policyAn occurrence policy covers injury or damage that happens during the policy period, even if the claim is filed after the policy has ended.Read the definition, so the policy that responds is usually the one in force when the injury or damage happens, not when you did the work. If you let coverage lapse after a job, claims about that job can land in a gap. See general liability for how limits work.