Case Law Alerts
Professional liability and general liability insurance policies cover different risks.
The architect/defendant designed a parking garage. A collapse occurred during construction, resulting in death and injury. The architect's professional liability insurance applied and was exhausted. It then sought coverage from its general liability insurer, who denied coverage due to a professional services exclusion. The architect sued insurer. The court ruled for the insurer as the alleged negligence of the architect flowed from its professional role. Professional liability policies are intended to cover risks inherent to a particular profession, such as the failure to perform with a standard of skill expected. A professional act or service is one arising out of a vocation, calling, occupation, or employment involving specialized knowledge, labor, or skill, and the labor or skill involved is predominantly mental or intellectual. A General Liability policy covers risks that arise with the operation of a business. The categorization of a party's liability is determined based on the Activity that party was involved in at the time the liability arose. As the liability arose from the architect's professional services, coverage was properly denied.
Case Law Alert - 3rd Qtr 2010