§ 3.16 Collapse

• Library: Guide to South Carolina Liability and Property Insurance Law (SCBar) (2019 Ed.)

§ 3.16 Collapse

The federal district court addressed whether coverage would be afforded for roofs that were in immediate danger of collapsing, versus already collapsed under a property policy in Hilton Head Resort Four Seasons Center Horizontal Property Regime Council of Co-Owners, Inc. v. General Star Indemnity Co.⁹⁷ The policy at issue stated:

D. ADDITIONAL COVERAGE - COLLAPSE

The terms Covered Cause of Loss includes the Additional Coverage - Collapse as described and limited in D.1. through D.5. below.

1. We will pay for direct physical loss or damage to Covered Property, caused by collapse of a building or any part of a building insured under this coverage form, if the collapse is caused by one or more of the following:

a. The "specified causes of loss" or breakage of building glass, all only as insured against in this Coverage Part;
b. Hidden decay;
c. Hidden insect or vermin damages;
d. Weight of people or personal property;
e. Weight of rain that collects on the roof;
f. Use of defective material or methods in construction, remodeling or renovation if the collapse occurs during the course of the construction, remodeling or renovation. However, if the collapse occurs after construction, remodeling or renovation is complete and is caused in part by a cause of loss listed in D.1.a. through D.1.e., we will pay for the loss or damage even if use of defective material or methods, in construction, remodeling or renovation, contributes to the collapse. If the collapse is caused by a cause of loss listed in D.1.b through D.1.f., we will pay for loss or damage to that property only if:

a. Such loss or damage is a direct result of the collapse of a building insured under this Coverage Form; and
b. The property is Covered Property under this Coverage Form.⁹⁸

The insured sought to recover under the policy for damages in the amount of $1,596,540 for mansard roofs that were originally constructed when the buildings were built in 1980/1981. The cause of the damage to the roof was disputed; however, it was undisputed that the roofs did not physically fall off of any building to the ground. Further, there was no sagging, or drooping, and no members had gaped, slipped, or separated from the other members. However, the insured's expert stated the roofs were in immediate danger of collapse.⁹⁹ Ultimately, the court determined that the claim was not covered.

The court rejected the insured's contention that the damage to the roofs constituted "collapse" under the...