A federal judge has determined that the collapse of the World Trade Center's twin towers is a single occurrence as defined by insurance binders signed by the buildings' leaseholder and are not separate events that would force insurers to pay two claims. The ruling affects only three of the 22 property insurers of the complex destroyed by terrorists, but could pave the way for payments of an insured loss of $3.5 billion, instead of $7 billion, as the buildings' leaseholder has sought.

Judge John S. Martin Jr., of the U.S. District Court for the Southern District of New York, made the ruling Sept. 25, 2002.

Silverstein Properties Inc., the leaseholder, maintains the attacks were separate incidents that would entitle it to collect twice. Silverstein had signed a 99-year lease weeks before the attack and had obtained insurance binders, but final documents were not signed before the Sept. 11 attacks. Silverstein has maintained the binders were open to more than one interpretation, which should be determined by a jury.

The companies disagreed, citing insurance binders that would view the Sept. 11 events as a single event. The ruling was in response to motions for dismissal made by Hartford Fire Insurance Co., Royal Indemnity Co., and St. Paul Fire and Marine Insurance Co. "The ordinary businessman would have no doubt that when two hijacked planes hit the Twin Towers in a 16 minute period, the total destruction of the World Trade Center resulted from 'one series of similar causes,'" the judge wrote.

"Obviously, we disagree with the ruling and will consider an appeal at the appropriate time," says spokesperson Gerald McKelvey. "However, these three insurers' coverage amounts to a total of $112 million per occurrence, so that limiting these insurers to a single occurrence does not have a material effect on the overall amounts of $6.7 billion to be recovered in the litigation."

"We're very pleased by the judge's well-reasoned ruling," says Kim O'Connell, spokesperson for the St. Paul Cos.

The Hartford Insurance Group also expressed satisfaction. "The Hartford has satisfied its insurance obligations for the single occurrence and believes it has no further obligations for the World Trade Center loss," a company statement says.

Silverstein had previously settled claims with Ace Bermuda Insurance Ltd. and XL Insurance Ltd.

Swiss Re, the lead insurer of the WTC with 22 percent of the total claim pending, was not affected by the Sept. 25, 2002 ruling.