The exclusions found in general liability (“CGL”) policies are virtually always preceded by a preamble that there is no coverage “because of,” “arising out of,” or “based on” each of those enumerated exclusions. The interchangeable use of these undefined modifier phrases has required courts around the country to consider whether, based on the interpretation of those modifiers, an exclusion potentially applies as a bar to coverage for a particular claim.

The Superior Court of New Jersey in C.M.S. Investment Ventures v. American European Insurance Company, Docket No. A-2056-17T3, 2019 WL 2266674 (App. Div. May 28, 2019), recently considered this and other fundamental issues of insurance policy construction and interpretation under New Jersey law.