Court Rules State Farm Owes No Duty to Defend, Cover Contractor’s Faulty Work

In a ruling issued earlier this month, a Pennsylvania court found that State Farm owed no duty to defend or provide coverage for a contractor’s negligent installation of a roof.

The case, State Farm Fire and Casualty Company v. Kim’s Asia Construction, centers on an underlying lawsuit filed by Powerline Imports, Inc. The plaintiff alleged that Kim’s Asia Construction’s negligently installed new roof leaked during minor rain storms.

As a result of the allegation, Kim’s Asia sought coverage and defense under its policy with State Farm. The insurer filed a declaratory judgment seeking confirmation that it had no duty to defend or indemnify Kim’s Asia.

The court granted State Farm’s motion citing its reliance on the four corners of the underlying complaint, despite Kim’s Asia reasoning that there was an alternative reason for the leaks. The court further noted that the only claim within the underlying complaint was faulty workmanship and thus didn’t qualify as an occurrence under the general liability policy.