(o) to property damage to work performed by or on behalf of [Mapes] arising out of the work or any portion thereof, or out of materials, parts or equipment furnished in connection therewith . . . . The insurer in Thos v. Employers Mutual Cas. Co., 215 Neb. 424, 338 N.W.2d 784 (1983), had issued a comprehensive liability policy with substantially the same language as involved here. The insurer refused to defend an action brought against the insured which arose from the insured's erection of a hog confinement structure which was later wind damaged.
Nevertheless, if, according to facts alleged in a petition and ascertained by an insurer, the insurer has no potential liability to its insured under the insurance agreement, then the insurer may properly refuse to defend its insured. See Thos v. Employers Mutual Cas. Co., 215 Neb. 424, 338 N.W.2d 784 (1983). Although an insurer is "obligate[d] . . . to defend all suits brought against the insured, even though groundless, false, or fraudulent, the insurer is not bound to defend a suit based on a claim outside the coverage of the policy."
Where the insureds' loss falls within specific exceptions contained in the policy, the court must apply the exception. Roth v. Farmers Mut. Ins. Co., 220 Neb. 612, 371 N.W.2d 289 (1985); Thos v. Employers Mutual Cas. Co., 215 Neb. 424, 338 N.W.2d 784 (1983). Recognizing that we are not here deciding an actual case but, rather, rendering an opinion as to the theoretical meaning of a phrase in an insurance policy under facts recited to us, we do not interpret the language "arising out of" to require more than a causal relationship.
Raff, supra. Where the insured's loss falls within specific exceptions contained in the policy, the court must apply the exception. Thos v. Employers Mutual Cas. Co., 215 Neb. 424, 338 N.W.2d 784 (1983); Raff, supra; Steinbach v. Continental Western Ins. Co., 237 N.W.2d 780 (Iowa 1976). Whether the plaintiff's loss was covered by the insurance policy was a question of law.