Products Completed Operations Coverage makes CGL policy exclusion ambiguous
In Dodson v. National Union Fire, Dodson, which salvaged aircraft, had an insurance policy with National Union which only provided for Products Completed Operations Coverage (PCO). The PCO did not have its own coverage section. Rather, PCO coverage was provided in the definition section of the policy, Section V. This was troublesome to the court since the care, custody and control exclusion relied upon by National Union to decline coverage was in Section I, Coverage A. Since there was nothing which clearly stated that the exclusions set forth in Coverage A would apply to the PCO coverage, however, the policy was ambiguous and must be construed in favor of coverage.
There are at least two interesting things about this decision. First, it shows that the court is continuing to look closely at exclusions. In this case, it found that exclusions in one section of the policy do not apply to coverage in a different section of the policy. Second, the court would have found coverage for general liability, based on the insurer's use of the term not applicable next to the line for Commercial General Liability Coverage General Aggregate Limit (other than Products /Completed Operations) on the declarations page. The court found the "not applicable" to apply to the general aggregate limit, not to the coverage itself.
