1. Forms
2. CG
3. CG-25-46

What the form is

The CG 25 46 Designated Location(s) Products-Completed Operations Aggregate Limit endorsement is an Insurance Services Office (ISO) form used to modify the standard Commercial General Liability (CGL) policy. Its primary function is to stipulate that the Products-Completed Operations Aggregate Limit applies separately to each specific location designated in the endorsement's schedule. Without this endorsement, the Products-Completed Operations Aggregate Limit typically applies to all of the insured's locations collectively. This means a large claim related to products or completed work at one location could exhaust the limit for all locations.

Classes of business it applies to

This endorsement is particularly relevant for businesses that operate out of multiple distinct physical locations and have a significant products-completed operations exposure at each. Examples include:

• Retail Chains: Businesses with multiple storefronts (e.g., electronics stores, hardware stores) where products sold could lead to liability claims.
• Restaurant Franchises: Each restaurant location could have its own products liability exposure (e.g., foodborne illness). Franchise agreements may also mandate separate limits.
• Manufacturing Companies: Businesses with several production plants where products are made and distributed.
• Service Businesses with Multiple Branches: Companies like auto repair shops or contractors with different operating bases where completed work could lead to claims.

For instance, a national restaurant chain might use this endorsement to ensure that a significant food poisoning claim at one of its locations does not deplete the products-completed operations coverage for all its other restaurants.

Special considerations

Key considerations for using the CG 25 46 endorsement include:

• Contractual Requirements: Often, contracts with landlords, franchisors, or clients may require the insured to maintain separate Products-Completed Operations Aggregate Limits for specific locations or projects. This endorsement helps fulfill such requirements.
• Risk Segregation: It allows a business to better segregate its risk by location, ensuring that a catastrophic products-completed operations event at one site doesn't leave other sites with insufficient coverage.
• Clarity in Coverage: The endorsement clearly defines which locations are subject to the separate aggregate limit, which can prevent disputes in the event of a claim.
• Limitation: This endorsement applies the aggregate limit on a per-location basis only for the Products-Completed Operations Hazard. The General Aggregate Limit for ongoing operations might still apply on a policy-wide basis unless modified by a different endorsement (like the CG 25 04 for designated locations general aggregate).

Key information for agents and underwriters

For Agents:

• Identify clients with multiple locations and significant products-completed operations exposures.
• Inquire about any contractual obligations that necessitate separate aggregate limits per location.
• Explain the benefit of protecting each location's aggregate limit from claims arising at other locations.
• Ensure all desired locations are accurately listed in the endorsement schedule.

For Underwriters:

• Assess the individual products-completed operations exposure at each designated location to determine appropriate pricing.
• Review the nature of operations at each site; a manufacturing plant might have a different risk profile than a retail outlet for the same insured.
• Consider the overall claims history of the insured, particularly related to products and completed operations.
• Verify if other aggregate limit endorsements are in place (e.g., for projects or the general aggregate) to understand the full scope of how aggregate limits are applied to the policy.