Tenth Circuit Limits Policyholder Recovery for Defective Work and Rejects Windfall Award

This coverage dispute arose from a claim to recover the policyholder’s cost of repairing a site dewatering system.  Glacier Construction Company (Glacier) had contracted with a municipal body to build a new wastewater pumping facility.  Glacier purchased a builder’s risk insurance policy from Travelers Property Casualty (Travelers), which included coverage for “Builder’s Risk Site Preparation.”

That provision stated, in pertinent part, as follows:  “If … You incur expenses to reexcavate the site, reprepare the site, regrade the land, or reperform similar work because of loss …

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