Court Deems Insect Damage Falls Under Meaning Of Collapse

Homeowners	Collapse
Sudden	Insects

Rose Wangerin owned a house that was occupied by Alex and Karen Herrera. In March 2003, Wangerin and the Herreras filed a claim under their homeowners policy when they discovered that the house was infested with insects and that the floors had dropped approximately four inches. Their insurer, New York Central Mutual Fire Insurance Company (New York), denied the claim. Wangerin and the Herreras filed an action seeking a declaration that the loss was covered under the terms of the policy. The lower court found in favor of the plaintiffs. The insurer appealed.

The policy covered “physical loss to covered property involving collapse of a building or any part of a building,” but only if such collapse was caused by, among other things, “hidden insect or vermin damage.” The policy did not define the term “collapse.” However, it did provide that a “[c]ollapse does not include settling, cracking, shrinking, bulging or expansion.” The parties agreed that the damage had been caused by insect infestation, but New York argued that there was only a “settling” of the building, as opposed to a “collapse.”

The New York State Supreme Court found that the damage was covered and rendered judgment in favor of the plaintiffs. New York appealed.

On appeal, the Supreme Court, Appellate Division, noted that, in the past, courts had concluded that the term “collapse” involved “an element of suddenness, a falling in, and total or near total destruction,” but that the “modern trend” was to hold that policy provisions that define collapse as not including cracking and settling provide coverage only if there was a “substantial impairment of the structural integrity of the building or any part of a building.” The plaintiffs’ expert witness concluded that there had been such a “substantial impairment of the structural integrity of the building” and that there was evidence of “sudden damage” as opposed to “settling.”

The appellate court found no reason to dispute that finding and held that the loss was covered within the meaning of the policy.

The decision of the lower court in favor of the plaintiffs was affirmed.

Wangerin vs. New York Central Mutual Fire Insurance Company-Supreme Court, Appellate Division-November 7, 2013-974 New York Supplement 2d 631 (2013 NY)