Presentation is loading. Please wait.

Presentation is loading. Please wait.

PAMIC Claims Summit 2013. Pennsylvania Law So, the loss is covered. Now what? CAN it be repaired? MUST it be repaired? MATCHING issues This portion of.

Similar presentations


Presentation on theme: "PAMIC Claims Summit 2013. Pennsylvania Law So, the loss is covered. Now what? CAN it be repaired? MUST it be repaired? MATCHING issues This portion of."— Presentation transcript:

1 PAMIC Claims Summit 2013

2 Pennsylvania Law So, the loss is covered. Now what? CAN it be repaired? MUST it be repaired? MATCHING issues This portion of presentation will cover: The current state of PA law (Greene v. USAA) Language from common form policies Cases where the law is applied to: Roofing Siding Flooring

3 Typical Policy Language Policy language from: AAIS Form 3, Ed. 2.0 ISO Properties, Inc., Homeowners Form HO ISO Properties, Inc., Commercial Property Form CP

4 AAIS Form 3, Ed. 2.0 How Much We Pay For Loss or Claim 1. Replacement Cost Terms e) If the limit on the damaged building is at least 80% of its replacement cost at the time of the loss, the smaller of the following amounts is used in applying the terms under Our Limit: the cost to repair or replace the damage on the same premises using materials of like kind and quality, to the extent practical 1) the cost to repair or replace the damage on the same premises using materials of like kind and quality, to the extent practical 2) the amount spent to repair or replace the damage

5 ISO Homeowners Form HO C. Loss Settlement 2. Buildings covered under Coverage A or B at replacement cost without deduction for depreciation, subject to the following: A….we will pay the cost to repair or replace, after application of any deductible and without deduction for depreciation, but not more than the following amounts: The replacement cost of that part of the building damaged with material of like kind and quality and for like use 2) The replacement cost of that part of the building damaged with material of like kind and quality and for like use…

6 ISO Commercial Property Form CP Replacement Cost e. We will not pay more for loss or damage on a replacement cost basis that the least of (1), (2) or (3), subject to f. below: 2) The cost to replace the lost or damaged property with other property: a. Of comparable material and quality; and a. Of comparable material and quality; and b. Used for the same purpose… b. Used for the same purpose… f. The cost of repair or replacement does not include the increased cost attributable to enforcement of any ordinance or law regulating the construction, use or repair of any property

7 Greene v. USAA Greene v. United Services Automobile Association, 2007 PA Super 344; 936 A.2d 1178 (2007) Leading case on the matching issue in PA denied Appeal denied by PA Supreme Court at 598 Pa. 750; 954 A.2d 577 (2008) Followed Followed by Nordi v. Keystone Health Plan West, Inc., 2010 PA Super 11; 989 A.2d 376 (2010)

8 Greene v. USAA Facts Dr. Ronald Greene and Rochelle Greene owned a home with special shingles, no longer made Roof was 18 years old Tree fell, knocked shingles off of the roof Greenes demanded entire roof be replaced because they didnt want a roof with mismatched shingles USAA would not pay for entire roof, only that portion actually damaged

9 Greene v. USAA Policy Language …we will pay the cost to repair or replace, after application of the deductible and without deduction for depreciation, but not more than the lease of the following amounts: 1) the limit of liability under this policy that applies to the building; the replacement cost of that part of the building damaged; or 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 like construction and use The replacement cost will not exceed that necessary for the like construction and use on the same premises…

10 Greene v. USAA Holding We find this interpretation of the policy language to be unreasonable and absurd The policy clearly and unambiguously requires USAA to pay the replacement cost of the part of the building damaged. As noted above, [the Greenes] contend that this policy language requires USAA to pay for the cost of replacing their entire roof because the roof was part of the building damaged. We find this interpretation of the policy language to be unreasonable and absurd. not replacement with the identical item damaged Also, [t]he policy clearly and unambiguously provides for like construction, not replacement with the identical item damaged. Keywords: Like (AAIS and ISO Homeowner forms, USAA Policy) Comparable (ISO Commercial Form)

11 Siding Weiler v. Union Ins. Co., 2006 Neb. App. LEXIS 150 Insureds home equipped with metal siding, one side damaged by hail Insured demanded all siding be replaced, to avoid differences between new and faded siding Policy paid for [t]he replacement cost of that part of the building damaged for like construction and use on the same premises Holding: Insurer only obligated to replace damaged siding, not all siding This would return home as nearly as possible to its pre- damage condition

12 Flooring Mastin v. Sandy & Beaver Ins. Co., 10 Ohio Misc.2d 22; 461 N.E.2d 332 (1983) Insureds vinyl flooring damaged when hole cut to gain access to home plumbing Insurer only wanted to patch the floor Insured wanted entire floor replaced Holding: the Court held that vinyl flooring cannot be said to be repaired if an obvious patch is left, and that the whole floor ought to have been replaced


Download ppt "PAMIC Claims Summit 2013. Pennsylvania Law So, the loss is covered. Now what? CAN it be repaired? MUST it be repaired? MATCHING issues This portion of."

Similar presentations


Ads by Google