Broad Form Products Coverage under the Garage Form

July 2, 2014

The insured garage replaces engine in a customer's car. The engine that was installed failed due to a defective head gasket. The insured purchased broad form products coverage under endorsement CA 25 01 12 93. Is the engine considered the insured's product and would coverage apply under the broad form products coverage?

Oklahoma Subscriber

The engine is the product of the named insured since the definition of “products” includes the goods or products that the named insured makes or sells in a garage business. As for coverage, the endorsement, CA 25 01, deletes the defective products exclusion and provides coverage but only to that amount of property damage to the product that exceeds $250. So, the insured has coverage but also has a $250 deductible in this instance.