Gas station’s insurance policy, which insured against collapse but not settling, cracking, shrinkage or expansion, did not cover needed repairs after the outer shell of the insured’s underground gas storage tank split open but inner steel lining remained intact. If a property insurance policy covers “collapse” without specially defining the word, but also excludes coverage of settling, cracking, shrinkage or expansion, the policy does not cover mere “substantial impairment of structural integrity.” Here, a gas station had to excavate and repair an underground gas storage tank after its outer fiberglass shell split on the boulder that the tank had improperly been installed on top of, but the inner steel lining of the tank was still intact. At most, the fact that the tank no longer met state environmental regulations and could no longer be used until repaired meant that there had been a substantial impairment of its structural integrity, but not a collapse.
California Court of Appeal, Second District, Division 2 (Hoffstadt, J.); July 3, 2017; 2017 WL 2839138