1. Forms
2. CG
3. CG-20-39

Form CG 20 39: Additional Insured – Owners, Lessees or Contractors – Automatic Status When Required in Written Construction Agreement with You (Completed Operations)

Line of Business: Commercial General Liability

1. What the Form Is

The CG 20 39 is an endorsement to the Commercial General Liability (CGL) policy that provides automatic additional insured status specifically for "products-completed operations hazard." Its primary purpose is to extend coverage to any person or organization (such as an owner, lessee, or contractor) for whom the named insured has performed operations, but only when a written construction agreement between the named insured and that person or organization requires them to be added as an additional insured. This automatic status means the policy doesn't need to be individually endorsed each time such an agreement is made, streamlining the process for contractors who frequently enter into such contracts.

The endorsement further extends this additional insured status to other parties that the named insured is required to add as an additional insured under that same written construction agreement. Crucially, the coverage afforded to these additional insureds is for "bodily injury" or "property damage" that occurs after the named insured's work is completed and is caused, in whole or in part, by "your work" (the named insured's work) that is included in the "products-completed operations hazard."

2. Classes of Business It Applies To

This endorsement is predominantly used in the construction industry. It is vital for:

• Subcontractors: Virtually all subcontractors (e.g., plumbers, electricians, HVAC installers, framers, roofers) will find this endorsement necessary, as general contractors and project owners routinely require it in construction contracts.
• General Contractors: While general contractors often require this from their subcontractors, they may also be required to provide similar additional insured status to project owners or developers for their completed work.

Real-world example: A commercial developer hires a general contractor (GC) to build an office complex. The GC subcontracts the electrical work to an electrical company. The contract between the GC and the electrical subcontractor requires the electrical sub to name both the GC and the developer as additional insureds for completed operations. The electrical sub has the CG 20 39 endorsement on their CGL policy. Two years after the complex is completed and occupied, a fire starts due to faulty wiring installed by the electrical subcontractor, causing significant property damage. Both the GC and the developer would be considered additional insureds under the electrical subcontractor's CGL policy for this damage, subject to the policy's terms and limits, because of the CG 20 39 endorsement and the written construction agreement.

3. Special Considerations

Several important factors must be considered when utilizing or relying on the CG 20 39 endorsement:

• Written Construction Agreement is Key: The automatic additional insured status is only triggered if a written construction agreement requires the named insured to provide it. Without such a written agreement explicitly stipulating this requirement, the endorsement does not grant additional insured status.
• Completed Operations Only: This endorsement applies exclusively to liability arising out of the named insured's completed work (i.e., the "products-completed operations hazard"). It does not provide additional insured coverage for ongoing operations. Separate endorsements (e.g., CG 20 10 or CG 20 33) are needed for ongoing operations coverage.
• Causation by "Your Work": Coverage for the additional insured is limited to liability for "bodily injury" or "property damage" caused, in whole or in part, by the named insured's work. It does not cover the additional insured's sole negligence or liability arising from work performed by others.
• Scope of "Other Parties": The extension of coverage to "other parties required to be added as additional insureds under the same written agreement" can be broad. It's essential to understand the full scope of contractual obligations regarding additional insureds.
• Contract