AAIS continues to evolve its offerings in the Inland Marine (IM) space, where it has long been an industry leader. Our most recent product update includes a Defective Design and Construction Coverage endorsement to go with a Builders’ Risk policy. This enhancement is a result of input and engagement by Members who were looking for something similar to the LEG 3 (London Engineering Group) endorsement. Its intent is to narrow a policy’s automatic exclusion, providing broader coverage for materials, workmanship, and faulty design during construction, making it easier for insureds to be made whole. The Defective Design and Construction Coverage endorsement is available for large and mid-size construction projects when traditionally, it was available only for large projects.

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An additional LEG 2 endorsement would be redundant since this level of defective design and construction coverage is already part of AAIS’s Builders’ Risk forms. It is the same level of coverage as a LEG 2 endorsement, which excludes loss caused by defective design and construction, but resulting loss is covered.

A Special Form has also been added to our Builders’ Risk Coverage – Scheduled Jobsite Form (IM 8150). This Special Form differs from the Scheduled Jobsite Form (IM 7050) in that it explicitly provides coverage for resultant loss from defective design and construction. IM 7050 provides the same level of coverage, but it is done implicitly as an exception to a policy exclusion. This form is now available to AAIS Members.

Reach out to our team if you’re interested in learning more about IM coverage.