8.7.2 Exclusion j(5) - Property Damage While the Insured Is on the Job Site

• Jurisdiction: Arizona

Exclusion j(5) excludes coverage for property damage to that particular part of real property upon which the insured was working and performing operations at the time of loss, provided that the property damage arises from said operations. The Arizona courts have not interpreted this exclusionary language. Courts from other jurisdictions, however, have held that Exclusion j(5) is unambiguous, and excludes coverage for property damage that must be repaired or replaced because the insured's work was incorrectly performed on the property.^[375] This clauses excludes coverage for damage to any part of real property upon which construction work is in progress, provided that the property damage arises out of the construction work. Some courts have held that the exclusion contains a temporal element, such that the exclusion only applies to damage that was caused during the time the insured was working on the property, and not property damage occurring after the work is completed.^[376]

As it pertains to exclusion j(5), the standard CGL policy provides that there is no coverage for "property damage" to "[t]hat particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the 'property damage' arises out of those operations." While Arizona has not...