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9/27/2017 » 9/29/2017
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Professional Services Exclusion in CGL Policy Upheld

Sunday, July 2, 2017   (0 Comments)
Posted by: Tom Jensen
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In State Farm Fire and Casualty Co. v. Morningside Consultants Inc., 2017 WL 2265959 (D.S.C May 24, 2017) the court considered whether State Farm had a duty to defend and cover MCI for eight state lawsuits arising out of alleged property damage to certain construction projects of which MCI allegedly provided inspection services. In the state lawsuits, the plaintiffs brought allegations against MCI concerning its purported negligence in its rendering or failing to provide inspections of the building units. Centex Homes, the builder of all of the pertinent construction projects, hired MCI to conduct inspections of Centex's and its subcontractor's work. The policy stated: “[T]his insurance does not apply to ... [b]odily injury[,] property damage[,] or personal and advertising injury arising out of the rendering or failure to render any professional service or treatment. This includes ... [s]upervisory [and] inspection ... activities. MCI argued the professional services exclusion did not apply because it was not required to have a professional license to perform its work. The court summarily rejected the argument noting the policy specifically called out "inspection" activities as an excluded risk. 

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