Care, Custody and Control Exclusion (Obhutsklausel)
The care, custody and control exclusion excludes from liability insurance damage to third-party property that is in the insured's custody, care, or control at the time of loss.
- Clause type
- Exclusion
- Origin/Market
- German market
- Favours
- Insurer
- Negotiability
- Negotiable
Standard wordings
- GDV AHB 2016 clause 7.6
Purpose
The care, custody and control exclusion is a common exclusion clause in general liability insurance under which damage to third-party property is excluded from coverage if that property is in the insured’s custody, care, or actual control at the time the loss occurs.
Effect and limits
The exclusion serves to distinguish general liability insurance from specialized covers designed specifically for the risk of damage to third-party property taken into custody, such as a warehouse keeper’s warehouse insurance or specific bailee clauses in commercial general liability insurance; without this exclusion, general liability insurance would effectively become property insurance for third-party property under the insured’s control.
Negotiation and practice
Because the care, custody and control exclusion can lead to significant and economically relevant coverage gaps in certain industries (such as freight forwarding, repair, or cleaning businesses), many insurers offer a buy-back of bailee’s coverage for an additional premium, frequently limited to a separate, lower sum insured and excluding particularly high-value items.