Products and Completed Operations: Definition and How It Works

Products and completed operations is a defined liability hazard within the standard Commercial General Liability (CGL) policy (ISO form CG 00 01) that covers bodily injury or property damage arising from a business's products after they leave its possession, or from work the business has completed after the job is finished and the insured has left the site. The two exposures — products and completed operations — are grouped under a single defined term in the CGL because both represent liability that materializes away from the insured's premises and after the insured's active involvement has ended. On most CGL policies, the products and completed operations hazard is subject to its own separate aggregate limit, distinct from the general aggregate that caps all other Coverage A and Coverage B claims during the policy period.

The Two Components Defined

Products hazard applies to bodily injury or property damage arising out of the named insured's product once that product has been sold, distributed, or abandoned by the insured. The injury or damage must occur away from premises owned or rented by the insured. A food manufacturer whose product causes illness after a consumer takes it home, or an equipment maker whose machine injures a worker after delivery to the buyer's facility, triggers the products hazard under Coverage A. Coverage for products liability is included in every standard CGL policy by default — there is no separate endorsement required unless the insured wants limits above the products-completed operations aggregate.

Completed operations hazard applies to bodily injury or property damage arising out of the named insured's work after that work has been completed or abandoned. "Completed" means the work specified in the contract has been finished; "abandoned" means the insured left without completing it. A plumbing contractor who finishes a bathroom remodel and leaves, and whose work later causes a pipe leak that floods the unit below, faces a completed operations claim — not a premises-and-operations claim — because the damage happened after the work was done. This distinction matters for coverage timing: premises-and-operations exposure exists while work is in progress; completed operations exposure begins when the work ends and continues as long as the policy covers it.

The Products-Completed Operations Aggregate

ISO CG 00 01 structures the CGL aggregate limits in two separate buckets:

  • General aggregate — the maximum the insurer pays for all claims under Coverage A (except products-completed operations), Coverage B, and Coverage C during the policy period.
  • Products-completed operations aggregate — the maximum the insurer pays for all Coverage A claims arising from the products-completed operations hazard during the policy period.

Each aggregate erodes independently. A manufacturer that exhausts its products-completed operations aggregate through product liability claims still has its full general aggregate available for premises, operations, and advertising injury claims. The per-occurrence limit applies within both buckets — it is the maximum paid for any single occurrence regardless of which aggregate it draws from.

For contractors, the products-completed operations aggregate is often the binding constraint on the CGL program. Construction defect litigation — claims alleging that completed work caused property damage years after project closeout — can generate large, multi-claimant losses that erode the products-completed operations aggregate while the general aggregate remains untouched. Brokers placing contractors should verify that the products-completed operations aggregate is adequate relative to the client's revenue, project size, and completed-work exposure — not just the operations-in-progress exposure.

Common Exclusions

Several CGL exclusions carve back the products and completed operations coverage granted by Coverage A:

  • Your product exclusion: No coverage for property damage to the named insured's own product — only third-party harm.
  • Your work exclusion: No coverage for the cost to repair or replace the insured's defective work itself — only consequential damage to other property. Many contractors buy a "your work" exception endorsement to partially restore this coverage.
  • Recall exclusion (sistership exclusion): Costs to recall, withdraw, or inspect products are excluded. Product recall insurance must be purchased separately.
  • Expected or intended injury: Damage the insured knew was substantially certain to result from its products or work is not an "occurrence" under the CGL and is therefore excluded.

Related Terms

How Brokers Use This in Practice

Brokers review the products-completed operations aggregate as a distinct underwriting and coverage adequacy question on every contractors, manufacturers, and distribution account. For a general contractor with $10 million in annual revenue, a standard $2 million products-completed operations aggregate may be inadequate if the firm has multi-year latent defect exposure from completed projects. Umbrella and excess policies typically follow the CGL's products-completed operations aggregate, so increasing limits at the underlying CGL level or purchasing a separate products-completed operations umbrella layer are the primary solutions.

For insureds in high-frequency completed operations states — California and Florida, in particular, where construction defect litigation is common — brokers should document in writing that coverage adequacy was discussed and that the insured accepted or declined higher limits. This documentation reduces E&O exposure if a future claim exhausts the aggregate. See the construction industry insurance guide for a fuller treatment of how products-completed operations fits into a complete contractor coverage program.