June 9, 2010

Colorado lawmakers have passed legislation that has stopped cold many carriers from writing General Liability coverage for contractors.

House Bill 1394 was signed into law on May 21, 2010. The law applies to all liability policies currently in existence or issued on or after this date. This law, as it now stands, legislates policy language that broadens the scope of coverage to require an insurer to "guarantee" a contractors' work and cover occurrences, including the contractors own faulty work, which took place prior to a policy's inception.

A spokesperson for the state's Professional Independent Insurance Agents says "We think the lawmakers just aren't understanding the unintended consequences of this." Like the unintended consequence of several companies we work with sending out bulletins to immediately cease binding any new or renewal business insuring construction operations in Colorado.

George Rothert