Court Opinion

ID: 9767034
Source: CourtListenerOpinion
Date Created: 2023-08-29 05:06:40.019066+00
Date Added: 2024-06-11T07:30:27.820444
License: Public Domain

Justice SAYLOR,
dissenting.
To the extent that the majority’s decision reflects a broadening of the understanding of the term “collapse” as utilized in property insurance policies to subsume “imminent collapse,” see Majority Opinion, op. at 174 n. 3, I concur with this departure from the existing precedent, which had embraced the narrower view requiring that property or a part of it actually fall down. See Kattelman v. Nat’l Union Fire Ins. Co. of Pittsburgh, 415 Pa. 61, 64, 202 A.2d 66, 67 (1964) (citing Skelly v. Fid. & Cas. Co. of New York, 313 Pa. 202, 169 A. 78 (1933)); Dominick v. Statesman Ins. Co., 692 A.2d 188, 190-91 (Pa.Super.1997). In my view, however, a change of this character should be applied prospectively, and not retroactively to existing policies such as the one at issue here, since the insurers were entitled to rely on this Court’s existing case law in crafting the applicable terms of such policies issued in Pennsylvania.
I also differ with the majority’s approach, and that of the Superior Court, in construing the phrase “risks of direct physical loss involving collapse” as extending coverage to protect against future collapse. While I agree that the term “risks of direct physical loss” is intended to reflect a broad form of coverage, its basic function is to extend coverage to a range of fortuitous events (such as fire, lightning, explosion, windstorm, hail, and smoke), see generally Lee R. Russ, 10 Couch on Insurance § 148.50 (2003), but not to protect against losses occasioned in mere anticipation of future events of these sorts. Indeed, in the policy at issue, “risks of direct physical loss” is not an isolated phrase confined to the collapse provision, but rather, stands as the central conception delineating the basic coverage provided, as it is specifically designated as being coterminous with “Covered Causes of Loss.”1
*464The way collapse is handled in the policy at issue is that it is subject, in the first instance, to a specific exclusion from the broad conferral of coverage, and thus, removed from the range of covered causes of loss (or the applicable risks of direct physical loss). See Policy, Cause of Loss—Special Form ¶ B(2)(k), R.R. 2a. The policy then affords specific coverage for collapse as “additional coverage,” but subject to several express limitations. See Policy, Cause of Loss—Special Form ¶0. In connection with this treatment, the language relied upon by the majority to extend coverage relative to future events in fact merely functions to restore collapse to the category of covered causes of losses, thereby reflecting the policy’s treatment of such risk as a defined one in an otherwise all-risk policy. Accord Ramsden v. Auto-Owners Ins. Co., 2000 WL 33521860, *4 (Mich.App. March 21, 2000) {per curiam ) (expressing the view that “the phrase ‘risk of collapse’ in this indemnity policy does not refer to the potential for collapse in the future but rather is used more generically to include the circumstance of ‘collapse’ within the ‘risks’ or perils insured against.”).2 But see Assurance Co. of America *465v. Wall & Assoc. LLC of Olympia, 379 F.3d 557, 558 (9th Cir.2004); Ocean Winds Council of Co-Owners, Inc. v. Auto-Owner Ins. Co., 350 S.C. 268, 565 S.E.2d 306, 308 (S.C.2002). Indeed, the alternate approach to which the majority gives credence in finding an ambiguity in the policy terms is fundamentally inconsistent with the policy’s central equation between “covered causes of loss” (again, events such as fire, lightning, explosion, windstorm, hail, smoke, and, here, collapse) and “risks of direct physical loss.” See supra note 1.3
Given the central role of the concept of “risks of direct physical loss” to policies affording insurance protection against property damage or loss, I believe that the majority’s construction of the provision as effectively extending coverage to losses and/or expenditures incurred in contemplation of future events may have wider ranging consequences than it may anticipate.
For these reasons, I respectfully dissent.

. The core coverage provision indicates that the insurer "will pay for direct physical loss of or damage to Covered Property” at the premises *464described in the Declarations caused by or resulting from any Covered Cause of Loss. Policy, Building and Personal Property Coverage Form ¶ A, R.R. at 46a (emphasis added). Under the policy, "Covered Cause of Loss” means "RISKS OF DIRECT PHYSICAL LOSS,” id. at § A(3), R.R. at la (emphasis in original) (cross-referencing Policy, Causes of Loss—Special Form ¶ A, R.R. at la), unless the loss is subject to an express exclusion or limitation. See id.
In fact, "risks of direct physical loss" is frequently employed by insurers in this way as a broad catch-phrase describing "all-risk” policy coverage (or insurance against all risks not within the defined exclusions and limitations, as opposed to defined-risk coverage). See Russ, 10 Couch on Insurance § 148.50.

. This point is advanced by one commentator as follows:
Of course, the cases finding coverage for a “risk of collapse" are inherently suspect, and turn on a questionable semantic conclusion. These cases suggest that the term ‘risk’ is equivalent to ‘possibility’ or ‘threat,’ and conclude a building suffering from structural impairment (but that has not collapsed) suffers from a ‘risk’ of collapse. In the context of a property policy, however, the term ‘risk’ means 'peril' or ‘hazard,’ not the 'threat' or ‘possibility.’ Indeed, property policies typically cover 'all risks,’ or specified ‘risks’ such as fire, lightning, theft or vandalism. The courts would never suggest that such policies cover every expense associated with a 'threat' or ‘possibility’ of *465fire, lightning, theft or vandalism, let alone the ‘threat’ or ‘possibility’ of ‘all risks.’
26 No. 15 Ins Litig Rep. 539 (Sep. 10, 2004).

. Under the understanding that the phrase “risk of direct physical loss" is used in the collapse provision as it is everywhere else in the policy, namely, to delineate the range of covered risks, and not to extend coverage for anticipation-related losses and/or expenditures, it is apparent that the additional words “involving collapse" function to describe the particular risk that is the subject matter of the specific-coverage provision.