Greene v. USAA1 is probably the most cited case by first-party insurance carrier attorneys in Pennsylvania. It is an appellate level case that centered on whether an insurance carrier is required to replace a roof when the existing shingle is no longer in production, but shingles of “similar color, texture, function, and shape” are available. In Greene, the Superior Court of Pennsylvania (appellate) held that using shingles similar to the damaged shingles in function, color, and shape satisfied the insurer’s obligation to pay for repair or replacement with like construction.
Greene involved the common scenario of a homeowner property sustaining damage to a roof resulting in a disagreement as to whether the roof needs to be repaired or entirely replaced. In this specific case, the damage was limited to a few shingles on one of the roof’s twelve slopes. The case went to trial and an award was issued in the amount of $3,173.37. The homeowner appealed, presenting the following question to the appellate court:
Whether an insured is entitled to have its [sic] roof replaced when part of the roof is damage as a result of a covered loss when matching shingles cannot be obtained and the homeowner’s insurance police provides for “replacement of that part of the building damaged” and for “like construction and use.
The relevant policy language read:
If, at the time of the loss, the amount of the insurance in this policy on the damaged building is 80% or more of the full replacement cost of the building immediately before the loss, we will pay the cost to repair or replace, after application of the deductible and without deduction for depreciation, but not more than the least of the following amounts:
(1) the limit of liability under this policy that applies to the building;
(2) the replacement cost of that part of the building damaged; or
(3) the necessary amount actually spent to repair or replace the damaged building.
The replacement cost will not exceed that necessary for the like construction and use on the same premises; regardless of whether the replacement building is located on the same or different premises.
The appellate court in Greene found that testimony at trial revealed that shingles of similar color and texture were available and that these shingles could have been used to repair the damaged slope of the insureds’ roof. The court held that a roof repair with shingles similar to the damaged shingles in function, color, and shape meets the parameters of “like construction” in the policy.
However, a case I like to cite in opposition of Greene is the Eastern District of Pennsylvania case, Collins v. Allstate Insurance Company,2 which dealt with the same issue. Collins distinguishes Greene by finding the following differences:
Here, in contrast to Greene, the Wagner affidavit states that “there are no slate tiles currently available on the market that are sufficiently similar in color, size and texture, to those on the Collins home at the time of the loss so as to make them of ‘like kind and quality’ or ‘equivalent construction’ as required under the terms and conditions of the policy.” Wagner states that repairing only the damaged portion of the roof would therefore “result in a different appearance on the roof than the one that … existed prior to the time of the loss and would not place the Collins’ back into the position they were in prior to the time of the loss.” The Wagner affidavit thereby raises genuine issues of material fact sufficient to defeat Allstate’s motion for summary judgment as to Count I.
The distinction between Greene and Collins is evidentiary. The Collins case shows that as long as the insured has evidence that rebuts a carrier’s opinion as to the availability of a shingle that is “similar in function, color, and shape”, such as an affidavit or perhaps an ITEL report reflecting there is nothing similar, then the determination of whether the roof needs to be repaired or replaced, at least due to aesthetic purposes, should be left to a fact-finder.
Lastly, it is important to note that an insured should have the carrier verify a shingle that the carrier proposes is similar, even if it is based on an ITEL report. ITEL reports tend to have language towards the end of the report stating “installers should verify visual and dimensional compatibility before purchasing and installing replacement products” or some similar verbiage.
1 Greene v. USAA, 936 A.2d 1178, PA Super 344 (2007).
2 Collins v. Allstate Ins. Co., 2009 WL 4729901 (E.D.PA Dec. 10, 2009).