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Bill > A599
NJ A599
NJ A599Requires that definition of occurrence in certain property damage liability insurance policies include coverage for faulty workmanship.
summary
Introduced
01/13/2026
01/13/2026
In Committee
01/13/2026
01/13/2026
Crossed Over
Passed
Dead
Introduced Session
2026-2027 Regular Session
Bill Summary
This bill requires commercial liability insurance policies to contain a definition of "occurrence" in order to provide more certainty with respect to coverage for faulty workmanship. This bill provides that a commercial liability insurance policy shall not be delivered, issued, executed, or renewed in this State, on or after the bill's effective date, unless the policy contains a definition of occurrence that includes: (1) an accident, including continuous or repeated exposure to substantially the same general harmful conditions; and (2) property damage or bodily injury resulting from faulty workmanship. Construction contracts typically require that the general contractor and any subcontractors performing work on a project secure commercial liability insurance that includes coverage for both property damage and bodily injury caused by an occurrence. Notwithstanding that this coverage is most often written on standard form insurance policies, courts have varied in their holdings as to whether damage from faulty workmanship is accidental in nature and therefore within the definition of an occurrence, for which coverage is provided. See, for example,
AI Summary
This bill mandates that commercial liability insurance policies, which are contracts of insurance for contractors and other construction professionals that cover property damage and bodily injury, must include a specific definition of "occurrence" to clarify coverage for faulty workmanship. Starting on the bill's effective date, these policies in the state cannot be issued or renewed unless they define an "occurrence" to include not only an accident, even with repeated exposure to harmful conditions, but also property damage or bodily injury that arises from faulty workmanship, a term that has historically been interpreted inconsistently by courts regarding whether it constitutes an accident. This legislation aims to provide more certainty for construction professionals by ensuring their insurance policies explicitly cover damages caused by their own defective work, though it does not prevent insurers from including other types of coverage exclusions.
Committee Categories
Business and Industry
Sponsors (1)
Last Action
Introduced, Referred to Assembly Financial Institutions and Insurance Committee (on 01/13/2026)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.njleg.state.nj.us/bill-search/2026/A599 |
| BillText | https://pub.njleg.gov/Bills/2026/A1000/599_I1.HTM |
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