Property Policy Won't Cover Evacuation Expenses Without Actual "Physical Loss" to Structure
On the advice of a structural engineer -- who believed an occupied building was about to collapse -- the bank occupant evacuated the building at considerable disruption and expense. Turns out the engineer was wrong. After settling its malpractice claim against the engineer, the bank sought coverage under its property policies for economic losses incurred in the evacuation.
Division 1 said there was no coverage. Not only did the bank fail to show the existence of any ""direct physical loss" in fact, the bank's preventive evacuation was not compensable under the "Sue and Labor" clause because no collapse in fact occurred even though the bank had a reasonable belief that collapse was imminent.
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