Insurance policies are all different. Some policies include a definition of the word “collapse” and some do not. The Kentucky Supreme Court in Thiele v. Kentucky Growers Ins. Co., 2017 WL 2598494 (Ky. June 15, 2017), recently addressed whether termite infestation and damage which caused substantial damage was covered under the policy’s collapse provision.
In relevant part, the policy’s collapse provision stated as follows:
8. Collapse – “We” pay for direct physical loss … involving the collapse of a building or part of a building caused by only the following:
(b) hidden insect or vermin decay.
The insured petitioned the Kentucky Supreme Court requesting that it abrogate its prior decision from 1962 and adopt the more lenient rule adopted by a majority of jurisdictions that “the structure need not be in imminent danger of collapse, but the damage to it must substantially impair the structural integrity of the building.” In other words, the damage must alter the basic stability or structure of the building in order to constitute a collapse.
The Kentucky Supreme Court declined to adopt the majority rule, and instead relied upon the following definition of collapse established in Niagara Fire Ins. Co. v. Curtsinger, 361 S.W.2d 762, 763 (Ky. 1962), which provides as follows:
The word ‘collapse’ in connection with a building or other structure has a well-understood common meaning. Webster’s Collegiate dictionary defines the word as, (1) To break down or go to pieces suddenly, especially by falling in of sides; to cave in.
The Kentucky Supreme Court held that even though the term “collapse” was not defined in the policy, its meaning was clear. As such, the court rejected that a condition of impending collapse is sufficient to trigger coverage.