Construction Claims: Active vs Completed Operations, in Plain English

5 min read Brian Berge · Independent insurance agent in Arden Hills, MN
Construction General Liability

Active and completed operations are not legal jargon for fun. They decide when a construction claim lands and which part of the policy responds.

Start here: General Liability & Premises Risk

Twin Cities job sites often stack multiple subs and tight timelines, which makes operations coverage and claim timing matter more than the brochure suggests.

Construction Claims: Active vs Completed Operations, in Plain English

You are still on the jobsite when the claim hits. That is one kind of problem.

You are long gone and the call comes anyway. That is a different kind of problem.

Construction liability lives on a timeline. Where the claim falls on that timeline is the difference between active operations and completed operations. If you want the quick read, start with Active Jobsite Operations: Liability While Work Is Ongoing and Completed Operations: Claims That Surface After You’re Gone.

What’s really going on

Active operations are claims tied to work that is still in progress. A ladder slips, a trench caves, a client walks into a tool you left where it should not be. The site is still live, and the risk is immediate.

Think of a delivery driver stepping over extension cords while drywall is mid-hang. That is active operations. The hazard is created by work that is still moving.

Completed operations are different. The work is done. The site is cleaned up. Then six months later, a pipe leaks behind a wall or a handrail fails. The timeline changes the investigation and the coverage focus.

A deck that passes inspection in June but pulls loose after a hard winter is a completed operations story. The site is quiet, but the exposure is still alive.

That time lag changes how claims are handled. The work crew is gone, the subs have moved on, and the paperwork is often in a different drawer. The claim becomes a reconstruction of what happened, not just what is happening.

This split matters for pricing because the loss patterns are different. Active claims are more about on-site controls. Completed claims are about workmanship, materials, and long-tail exposure.

Tradeoffs and gotchas

The first gotcha is thinking completed operations is a separate policy you can ignore. It is not. It is baked into your general liability, but the limits and exclusions still matter.

The second gotcha is contract language. Many contracts require specific completed operations limits. If you miss that, you can win the job and still have a coverage problem. The time to check is before you sign.

Another gotcha is assuming subcontractor coverage automatically protects you. If a sub has weak limits or lets a policy lapse, their completed operations exposure can flow back to you. Certificates are not enough if the limits do not match the contract.

The third gotcha is the long tail. Completed operations claims can show up years later. That means the policy in force at the time of the claim can matter as much as the policy you had when the work was done. This is why continuity matters more than most contractors expect.

There is also a misunderstanding about warranties. A workmanship warranty is not the same as completed operations coverage. One is a promise you make. The other is a liability trigger that the policy may or may not cover depending on the facts.

Record retention is part of this. If you cannot produce plans, change orders, and inspection notes years later, you are defending the claim with memory. That is not a strong position.

If your work touches equipment or mobile exposures, make sure you understand how that changes the story. Heavy and Mobile Equipment: Losses Beyond Theft is a good example of a risk that does not fit neatly in a single box.

Price levers or decision factors

The pricing drivers are practical, not theoretical:

  • Type of work. Remodels and structural work have longer tails than punch-list items.
  • Project size and duration. Longer jobs leave more time for accidents and more opportunity for disputes.
  • Subcontractor control. If subs carry weak coverage, your completed operations exposure grows.
  • Contract requirements. Limits and indemnity language can change who pays when something goes wrong.
  • Claims history. A few completed operations claims can shift pricing more than a stack of small active losses.

Completed operations claims also tend to be slower to close. That long tail makes underwriters cautious. If your work has a history of late-arising issues, the pricing reflects that caution.

Project documentation helps here. Photos, change orders, and closeout checklists can shorten the claim timeline and reduce disputes. That is not a coverage change, but it is a pricing signal over time.

If you have a standard closeout package, treat it like a safety tool, not just a paperwork chore.

If you are trying to control those levers, start with Active Jobsite Operations: Liability While Work Is Ongoing. It is the easiest place to reduce frequency.

Simple decision rule

If you do work that can fail later, treat completed operations limits as non-negotiable. If your work is short-term and low-risk, you can often keep the coverage leaner, but do not guess. Let the contract and the actual exposure decide.

Keep subcontractor certificates current, not just on file.

Closeout photos help more than you think.

Next step

Pull one recent contract and read the insurance section line by line. Then compare it to your policy. If you want a refresher, Completed Operations: Claims That Surface After You’re Gone is the fastest way to ground the conversation.

Minnesota note: claim patterns and contractor timelines vary by county, so Twin Cities experience isn’t always a perfect proxy for outstate Minnesota.

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