A general contractor was sued for breach of contract after water damage occurred during a construction project. The contractor's insurance company denied coverage using a contractual liability exclusion in the CGL policy. The Texas Supreme Court ruled that when a contractor's only liability comes from contractual promises made in a construction contract, the insurance exclusion applies and there is no coverage—even if the contractor tried to get indemnity from insurers.
CGL insurance policies specifically exclude coverage for damages you agreed to pay under a construction contract. This exclusion is enforceable and will likely be upheld in court.
The 'insured-contract exception' does not restore coverage when your liability is purely contractual. Review your policy's exceptions carefully—they may not help you.