A fully covered business burns, due to another company doing faulty work, however the fire system did not work
Answer:
Well yes they are required to pay! The business was covered wasn't it?
Now if the cause of the fire / failure of a suppression system was due to negligence of another company, the insurance company can sue them if they want.
That's the way it works.
If you can prove that the faulty company was the proximate cause of the fire their liabilty/completed operations coverage would pay for your damages. If they can prove that if the fire system had been recharged and would have helped to minimize the damage then that would be a contributing factor and might have some weight on how the claim is settled. Good Luck
Define "fully covered". Sorry, that's WAY too generic.
If you are the "fully covered business" who owns the building that burned, and the policy has a "fire alarm/suppression system warranty" on it, AND you knew that the fire alarm wasn't recharged, that is grounds for your insurance company to deny the fire claim.
For the company doing faulty work, I've never seen a general liability policy with completed operations coverage pick up damage caused by the insured's faulty work to the part of the building they were working on. I'd argue that the FIRE was not caused by the faulty work, therefore, the company isn't responsible for the damage.
A key part of this would be, how long had the fire system been left unfunctioning. Obviously, if you can prove it was only a couple days, that's not your negligence. However, if it's been a month, well, hey, that's a problem.
Anyway, whoever insures the building for fire coverage is the most likely company to pay out, depending on the alarm warranty.
I assume you are asking about the burned business' own first party coverage. check your policy for a protective safeguard warranty. It may require that you inform the insurer of the warranted protection (ie, sprinkler system) is temporarily not in working order. However, there are many cases requiring reasonableness so the warranty is not always iron-clad. Check the protective safeguards endorsement or clauses and get a coverage lawyer to help make your claim. If they pay then they will subrogate against the contractor.
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