Tiara Condominium: The Demise of the Economic Loss Rule in Construction Defect Litigation and Impact on the “Property Damage” Requirement in a General Liability Policy

Published July 24, 2013 in Insurance Coverage, by the ABA Section Of Litigation


The Florida Supreme Court’s recent decision in Tiara Condominium Association, Inc. v. Marsh & McLennan Companies, Inc., 110 So. 3d 399 (Fla. 2013), significantly narrowed the application of the economic loss rule in Florida, holding that “the application of the economic loss rule is limited to products liability cases.” Although Tiara was not a construction insurance coverage case, the Court’s holding that the economic loss rule applies only in the context of product liability actions allows policyholders to argue that “property damage” under a Commercial General Liability (“CGL”) policy includes economic losses.

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