by Paul Barnard
First of all, welcome to Superior Control Systems Inc. from Tempe, Arizona, as new members of the CSIA Insurance Program.
Recently a CSIA member, not insured via our program, suffered a very substantial uninsured loss. This loss involved a large explosion resulting in substantial property damage. The cause of the incident was deemed to be faulty software. The insured had separate general liability and professional errors and omissions policies. For those not utilizing coverage via the CSIA Insurance Program, this is not unusual.
Sadly, their general liability policy included an absolute exclusion related to losses from professional services, presumably on the assumption that any such loss would be insured via the professional errors and omissions policy. Unfortunately, the professional errors and omissions policy had an absolute exclusion relating to property damage or bodily injury losses.
As a result neither policy provided coverage, and their umbrella policy did not kick in. The member was faced with an uninsured loss running into seven figures. How did such a situation arise? Well, it really is quite simple. Their advisors did not understand their business. Indeed, the CSIA Insurance Program was created after members complained that their insurance advisors didn't understand their businesses.
If you have separate general and professional liability policies, I strongly recommend that you check that the exclusions referred to above are not present. If you wish, I would be very happy to review your policies and provide you with an opinion as to their suitability.
We now have in excess of 90 members from around the world who participate in our programs. For more information, please contact me either at paulbarnard@csia-insurance.com or (001)-610-507-6595.