Page 16 - FDCC Insights Spring 2022

must be physical damage to covered property or to property within a specified distance of covered property. However, some civil authority provisions do not require physical loss or damage to property. For example,
in Sloan v. Phoenix of Hartford Ins. Co., the insured sought recovery for business losses caused by an eight-
property must undergo a “distinct, demonstrable, physical alteration,” and “some external force must have acted upon
the insured property to cause a physical change in the condition of the property.”); Georgetown Dental, LLC v. Cincinnati Ins. Co., et al., No. 1:21-cv-00383 (S.D. Ind. May 17, 2021) (Indiana law) (determining that the terms “physical loss” and “physical damage” require actual and demonstrable physical harm to the property); Columbiaknit, Inc. v. Affiliated FM Ins. Co., No. 99-434-HU, 1999 WL 619100, at *7 (D. Or. Aug. 4, 1999) (Oregon law) (holding that property suffers “direct physical loss” triggering coverage under a first party property policy when the property undergoes a “demonstrable physical change . . . necessitating some remedial action”); Nguyen v. Travelers Casualty Insurance Company of America, No. 2:20-cv-00597-RSM (W.D. Wa. May 28, 2021) (Washington law) (holding that “physical loss” requires “tangible, material, discernable, or corporeal dispossession of the covered property”); Torgerson Props., Inc. v. Continental Cas. Co., No. 0:20-cv-02184 (D. Minn. Feb. 17, 2021) (Minnesota law) (asserting that the term “direct physical loss of or damage to property” required “actual, demonstrable loss of or harm to some portion of the premises itself,” and did not encompass “simple deprivation of use”); System Optics, Inc. d/b/a Novus Clinics v. Twin City Fire Ins. Co., 2021 WL 2075501 (N.D. Ohio May 24, 2021) (Ohio law) (holding that “direct physical loss” requires “some actual harm to the structure rendering it uninhabitable or unusable”); Chief of Staff, LLC v. Hiscox Ins. Co. Inc., No. 20-C-3169, 2021 WL 1208969, at *1-*2 (N.D. Ill. Mar. 31, 2021) (Illinois law) (holding that “‘physical loss’ refers to a deprivation caused by a tangible or concrete change
in or to the thing that is lost’”); PF Sunset View, LLC v. Atlantic Specialty Ins. Co., No. 20-81224-CIV, 2021 WL 1341602, at
*2 (S.D. Fla. Apr. 9, 2021) (Florida law) (holding that “the plain meaning of the terms ‘direct physical loss of or damage to property’ unambiguously requires actual, tangible damage to the physical premises itself, not merely economic losses unaccompanied by a demonstrable physical alteration to the premises itself”); The Brown Jug, Inc. v. Cincinnati Insurance Company, No. 5:20-cv-13003, 2021 WL 2163604 (E.D. Mich. May 27, 2021) (Michigan law) (holding that, to constitute “direct physical loss or damage,” the insured property must be physically lost, damaged, replaced, or uninhabitable).
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Insights SPRING2021