Faulty Work You Performed Exclusion

April 13, 2015

Our insured runs an auto repair shop and claimant brought his auto in for repair of an antifreeze leak. Insured removed the thermostat housing and replaced the seals. Insured mechanic was unaware that he dropped a nut into a piston. When insured started the engine to check the leak, he heard a rattle in the engine. The piston was destroyed and required a new engine. Repairs amounted to $3,775.

Under the garagekeepers coverage, does the faulty work you performed exclusion apply?

Kentucky Subscriber

The key is whether the insured was finished with the repair work since that exclusion applies to work that the insured has finished with and while the vehicle is no longer in his care, custody, or control. It is our opinion that checking the repair work is part of the work and means the insured was not finished with his work. Moreover, the insured obviously had the vehicle in his care and custody and control. So, we do not see the exclusion applying in this instance.