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Prove the order blocked a real contract milestone

When borrowers said COVID-19 orders frustrated a plan to sell a radio station and repay a loan, the Pennsylvania Superior Court affirmed denial of relief: the record did not show a sale was close to completion by the contractual deadline or how the orders prevented it. For a government-action risk, identify the specific buyer, agreement or condition, milestone, date, and evidence linking the order to the missed performance. The ruling concerns contract defenses, not policy coverage. 1,2

What Is Contract Frustration?

Contract frustration may fit your business when an international contract is exposed to political disruption or government action. If your main risk is a customer who cannot pay, compare trade-credit coverage instead. Read the national Contract frustration guide.

What to Watch for in Pennsylvania

  • Distinguish a signed or imminent deal from a hoped-for sale

    In Centric Bank v. Sciore, the loan required an executed sale contract for the radio station by March 15, 2020, with closing by July 15. The borrowers had discussed potential buyers but did not produce an executed contract by the first date; the Superior Court found no abuse of discretion in concluding that the record did not show an imminent sale or how the pandemic orders prevented it. Keep dated offers, counteroffers, approvals, diligence records, and signed conditions that establish what was actually due. 1

  • Show the order’s direct effect on the specified obligation

    A government order and a financial loss occurring at the same time were not enough on this record. The Pennsylvania court examined whether the order prevented the particular promised sale and whether it was close enough to completion to frustrate the loan’s purpose. Map the order’s scope and dates to the contract milestone, the affected party, and available alternatives; separately ask the broker which policy wording would require that evidence. 1

  • For a Pennsylvania goods purchase, act on the seller’s notice

    Pennsylvania’s Commercial Code §2615 addresses a seller’s delay or nondelivery under a goods contract when an assumed contingency or good-faith government-order compliance makes performance impracticable; partial capacity calls for fair allocation and seasonable notice. Under §2616, a buyer receiving notice of material or indefinite delay may give written notice to terminate affected unexecuted deliveries or accept the available quota; if the buyer does not modify within a reasonable time, no more than 30 days, the affected deliveries lapse. These sale-of-goods rules do not govern every contract. 2,3

Who Regulates Insurance in Pennsylvania

Pennsylvania Insurance Department

The Pennsylvania Insurance Department publishes state tools to check licensed producers, agencies, and insurers, and its Consumer Services Online portal accepts complaints about insurers, agents, brokers, and public adjusters. The department also oversees Pennsylvania insurance business and consumer services. 4,5,6

Surplus-lines tax and stamping office

Reported tax rate: 3% of gross premium (2% for eligible surplus-lines risk retention groups) Pennsylvania charges 3% of gross surplus-lines premiums (2% for an eligible surplus-lines risk-retention group); the tax is in addition to premium, is borne by the insured, and is collected by the producer. For multistate risks, the 2025 Revenue instructions say all gross premiums are taxable when Pennsylvania is the home state, while Insurance Company Law §1621(d) says tax is levied only on premium reasonably ascribable to Pennsylvania risk; confirm allocation with your producer or the state. Surplus-lines coverage is excluded from the guaranty association, and qualifying large risks or exempt commercial purchasers may use distinct no-search routes, with the ECP route requiring disclosure and written request. 7,8,9,10

Providers With Documented State Licenses

No provider in Spot’s research documents both a state license record and this coverage line. This does not establish that providers are unlicensed. Check the regulator’s license lookup and confirm availability with a provider when requesting a quote.

Questions to Ask Before You Buy in Pennsylvania

  1. What specific performance, sale, permit, or closing milestone did the contract require, by what date, and what contemporaneous record shows it was achievable?
  2. Which government order applied to the relevant party and place, and what evidence shows it prevented that specific act rather than merely coinciding with financial distress?
  3. Does the agreement allocate the event through force majeure, termination, refund, or payment terms, and what substitute performance or buyer was available?
  4. For a goods contract, did the seller give seasonable notice of delay or quota, and when must the buyer send written termination or modification notice?

Contract Frustration in Pennsylvania: FAQ

Is a Pennsylvania government order alone enough to show a contract was frustrated? 1

No. In Centric Bank, the Superior Court affirmed denial of relief because evidence did not show a sale was imminent by the promised deadline or explain how the orders prevented it. The decision turned on that record and loan agreement. 1

Do §§2615–2616 set a general rule for every Pennsylvania contract? 2,3

No. These Commercial Code sections concern sellers and buyers under contracts for sale of goods. Confirm that the transaction is within that scope before relying on the statutory notice, allocation, or termination rules. 2,3

Contract Frustration in Other States

Other Coverage in Pennsylvania

Sources

  1. Centric Bank v. Sciore, 2025 PA Super 249. Superior Court of Pennsylvania; Decided November 7, 2025; pp. 37–40, loan requirement for an executed MEGA radio-station sale by March 15 and closing by July 15, government-order timing, absence of evidence of an imminent sale or causal link, and affirmance of denial of frustration/impracticability relief. Accessed 2026-09-28.
  2. Pennsylvania Consolidated Statutes, 13 Pa.C.S. §2615, Excuse by failure of presupposed conditions. Pennsylvania General Assembly; Official online consolidated statute accessed September 28, 2026; §2615(1)–(3), sale-of-goods seller government-order/impracticability rule, fair allocation, seasonable notice and estimated quota. Accessed 2026-09-28.
  3. Pennsylvania Consolidated Statutes, 13 Pa.C.S. §2616, Procedure on notice claiming excuse. Pennsylvania General Assembly; Official online consolidated statute accessed September 28, 2026; §2616(a)–(b), buyer may terminate unexecuted affected deliveries or modify to accept a quota by written notice; failure to modify within reasonable time, at most 30 days, causes affected deliveries to lapse; history includes P.L. 2013, No. 98. Accessed 2026-09-28.
  4. pennsylvania insurance regulator. State insurance regulator; PID official agency page and the search/consumer-help service map. Accessed 2026-09-28.
  5. Pennsylvania Insurance Industry Search Tool Library. State insurance regulator; PID identifies consumer Sircon and detailed individual, business-entity, and company search tools. Accessed 2026-09-28.
  6. File a Complaint with Your Insurance Company, Agent, Broker, or Public Adjuster. State insurance regulator; PID directs insurance complaints and questions to its Consumer Services Online portal. Accessed 2026-09-28.
  7. RCT-123 Gross Premiums Tax - Surplus Lines Agents (2025). Pennsylvania Department of Revenue; Instructions p. 4, imposition/base/rate: 3% on gross premiums; insured bears tax, producer collects/remits; RRG exception 2% per statute. Accessed 2026-09-28.
  8. Insurance Company Law, §1621. Pennsylvania General Assembly; Subsection (d): multi-state tax is levied only on premium reasonably ascribable to Pennsylvania risk. This differs from the 2025 RCT-123 instructions, which state all gross premiums taxable if PA is home state; see source tax. Accessed 2026-09-28.
  9. Insurance Department Act, surplus-lines notice provision. Pennsylvania General Assembly; Policy legend: insurer is not licensed and surplus-lines insurance is NOT covered by Pennsylvania Insurance Guaranty Association. Accessed 2026-09-28.
  10. Pennsylvania Insurance Company Law §§1604 and 1610 (40 P.S. §§991.1604, 991.1610). Pennsylvania General Assembly; Act 28 of 2011 §1610(a), (a.1): large-risk criteria and ECP disclosure followed by written request exempt from diligent-search requirements. Accessed 2026-09-28.
  11. Licenses. At-Bay; Current producer introduction and state table; At-Bay Insurance Services LLC; P&C and surplus-lines identifiers. Accessed 2026-09-21.
  12. Licenses and Carriers. Coalition; Licenses and Carriers, re-read 22 September 2026: Insurance Licenses table for Coalition Insurance Solutions, Inc., national producer number 18419475, with producer and surplus-lines numbers for all 50 states and DC including California 0L76155, Georgia 196479, Texas 2199630 and 2205589, Pennsylvania 815731 and 817452, Colorado 539028 and Wisconsin 3000108852. Insurance Carriers table naming, with NAIC numbers, Allianz Underwriters Insurance Company 36420, Arch Specialty Insurance Company 21199, Ascot Specialty Insurance Company 45055, Ascot Insurance Company 23752, Aspen Specialty Insurance Company 10717, Chaucer Insurance Company DAC, Coalition Insurance Company 29530, Fireman's Fund Indemnity Corporation 11380, Fortegra Specialty Insurance Company 16823, Lloyd's of London, MSIG Specialty Insurance USA Inc. 34886, MS Transverse Specialty Insurance Company 41807, Steadfast Insurance Company 26387, Vantage Risk Specialty Insurance Company 16275 and Zurich American Insurance Company 16535. Accessed 2026-09-22.
  13. Insurance Producer Licenses. Corgi Insurance; Current complete Insurance Producer Licenses table for Corgi Insurance Services, Inc.; 50 rows covering 49 states and DC (DC 3003091619); no New Mexico row; no NPN or as-of date shown. Accessed 2026-09-28.
  14. About Hiscox US Insurance. Hiscox; Hiscox Insurance Company Inc. NAIC 10200 as Chicago, IL domiciled insurer admitted or licensed in all 50 states and D.C.; Hiscox Inc. as general agent and Lloyd’s coverholder for Syndicates 33 and 3624; surplus-lines placements through licensed surplus-lines brokers; A.M. Best rating statement. Accessed 2026-09-16.
  15. Licenses. ERGO NEXT Insurance; Current entity-by-state license table reopened 28 September 2026: 50 rows under Next First Insurance Agency, Inc., including Washington, DC; New York rows instead list Next Insurance Services PC-1423070 and AP Intego BR-1198885. Accessed 2026-09-28.
  16. Insurance Licenses by State. TechInsurance; Current state table; identifies TechInsurance as a division of Specialty Program Group LLC d/b/a SPG Insurance Solutions; lists DC 3000041536 and labels Rhode Island “Individual licenses,” without an agency license number. Accessed 2026-09-28.
  17. Licenses. Vouch; Effective 16 January 2025: Vouch Specialty Insurance Services, LLC, NPN 19926463; P&C table (50 states and DC); surplus-lines table includes Idaho 870820; footnote says Georgia and Idaho do not issue agency-level surplus-lines licenses; Idaho retained as producer-only due to conflict. Accessed 2026-09-15.

Updated .

This guide is informational and does not determine whether a policy is available or meets your needs. Editorial policy. To suggest a correction, contact Spot with a supporting source.

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