A soil engineering subcontractor's faulty site-preparation work caused a building to settle and become unsafe, requiring demolition. The general contractor's insurance carriers denied coverage, claiming contractual liability and business risk exclusions applied. Wisconsin's Supreme Court ruled that the CGL policies must cover the property damage because it resulted from an accidental occurrence, even though the damage was also actionable as a contract breach. This means subcontractors and contractors cannot be left without insurance protection simply because their work failures are both negligent and contractually guaranteed.
CGL insurance covers property damage from faulty subcontractor work even when the damage is also a breach of contract—accidental occurrence coverage applies regardless
Contractual liability exclusions do not eliminate coverage for property damage that stems from an unintended accident, only intentional or expected losses
Subcontractors should ensure their contracts flow down insurance requirements to protect the general contractor, as GCs will look to their own policies first and may pursue indemnification claims