Affirmed in part and reversed and remanded in part by published opinion. Judge LUTTIG wrote the opinion, which Senior Judge BUTZNER and Judge THORNBURG joined.
OPINION
This diversity suit is a dispute over insurance coverage for the insured’s liability to a third party for an underground gasoline leak. We hold that under South Carolina law the insurance policy was only triggered once the gasoline reached the third-party’s property and that the insurer must indemnify the insured only for the damage that occurred while the policy was in effect.
I.
Beginning in or sometime before 1978, ap-pellee Spartan Petroleum leased a lot in Lau-rens County, South Carolina, on Highway 56 near Interstate 26, for use as a service station (“Chevron property”). Spartan also owned an underground gasoline storage system there. In January 1986, Spartan discovered that this system had been leaking. The total loss of gasoline amounted to about 16,-000 gallons. Spartan notified the South Carolina Department of Health and Environmental Control (“DHEC”), which ordered it “to determine the presence and probable fate of contamination (if any) to the environment.” Spartan also notified its insurer, appellant Federated Mutual Insurance Company, which paid for cleanup under Spartan’s coverage for first-party property damage.
Spartan in late 1986 installed monitoring wells on South Carolina’s highway right-of-way across the street from the Chevron property. These revealed that the gasoline had migrated to the State’s soil. Again, Federated paid for cleanup, this time under Spartan’s third-party liability coverage. A *807 further leak, of about 6,400 gallons, occurred in June 1988.
The first-party and third-party coverage were separate sections of a policy (“Federated policy”) that was in effect from January 19, 1985, to January 19, 1986, then was renewed for a year. 1 Section 1 covered first-party property damage. Section 2, which covered third-party liability, is a standard-form Comprehensive General Liability Insurance policy (“CGL”). Federated promised to
pay on behalf of the insured all sums which the insured shall, become legally obligated to pay as damages because of .. .property damage to which this insurance applies, caused by an occurrence, and the company shall have the right and duty to defend any suit against the insured seeking damages on account of such .. .property damage, even if any of the allegations of the suit are groundless, false or fraudulent.
The policy defines “occurrence” as “an accident, including continuous or repeated exposure to conditions, which results in ... property damageIt defines “property damage” as
(1) physical injury to or destruction of tangible property which occurs during the policy period, including the loss of use thereof at any time resulting there from, or (2) loss of use of tangible property which has not been physically injured or destroyed provided such loss of use is caused by an occurrence during the policy period.
The policy does not define “property.”
In March 1990, monitoring wells that Spartan had sunk the month before at a property adjoining the Chevron property (the “Roshto property”) detected gasoline contamination. As part of the DHEC-mandated cleanup of the entire area of contamination, Federated,under the third-party liability coverage, paid to cleanup the Roshto property. J.A. at 88, 296-97, 356.
Federated balked, however, when Spartan demanded that Federated defend and indemnify Spartan against a suit that the owners of the Roshto property filed in 1994. The owners sued for damages caused by the gasoline contamination of their property, in particular lost property value, lost use and enjoyment of the property, and damage to the business of the Holiday Inn located on the property. Under South Carolina law at the time, damage did not occur until it became manifest, and the damages to the Roshto property “did not manifest during the Federated policy periods.” J.A. at 116. Thus, in Federated’s view, “there was no property damage during the policy periods [1985-87],” and therefore no coverage.
While Spartan’s suit against Federated was pending, South Carolina law on when “property damage” occurs changed, the new rule being that coverage under a CGL policy is “triggered” when the first “injury-in-fact” occurs, regardless of when the damage becomes manifest.
Joe Harden Builders, Inc. v. Aetna Casualty and Surety
Co.,
The district court granted summary judgment to Spartan on both indemnification and the duty to defend. It held that under Joe Harden the injury to the Chevron property during the policy period was the injury-in-fact that triggered coverage under the policy for all damages “resulting from the leak that occurred in January 1986.” Thus “the date when the contamination migrated to the Roshto property” was “irrelevant.” The key date was when “Spartan suffered an injury-in-fact,” (emphasis added), not when the Roshto property or its owners suffered an injury-in-fact.
II.
Unlike the district court, we believe that the date when the gasoline migrated to the Roshto property is critical. We thus *808 reverse the summary judgment regarding indemnification. 2
The dispositive issue is what the term “property” means for purposes of “property damage ... which occurs during the policy period,” specifically, whether it means the property owned by the third-party claimant, which would require Spartan to prove when the gasoline migrated to the Roshto property, or, rather, all property harmed by a particular “occurrence,” which would allow injury to the Chevron property to trigger coverage for damages to the Roshto property. Before we can apply Joe Harden’s requirement of an injury-in-fact to trigger coverage under an insurance policy, this question must be answered. Joe Harden does not answer this question, notwithstanding the opposing claims of the parties. But the policy language and caselaw from other states do. We conclude that the injury-in-fact must be to the third-party’s property and thus that the gasoline contamination of the Roshto property must have occurred during the policy period in order for Federated to be liable. According to this understanding, the date of the gasoline leak and of the injury to the Chevron property (which are the same thing) is irrelevant.
In Joe Harden, the South Carolina Supreme Court answered the question of when “property damage” or “bodily injury” occurs under the standard CGL policy in cases involving progressive damages, such as latent defects, toxic spills, and asbestosis. Courts nationwide have struggled with this question, since the times of the injury-causing event (such as defective construction, a fuel leak, or exposure to asbestos), the injury itself, and the injury’s discovery or manifestation can be so far apart. The Joe Harden court, emphasizing the policy’s requirement that property damage “occur[ ] during the policy period,” chose the second of these three points, but added that damage can continue over several policy periods, thus triggering more than one policy:
[Cjoverage is triggered whenever the damage can be shown in fact to have first occurred, even if it is before the damage became apparent, and the policy in effect at the time of the injury-in-fact covers all the ensuing damages.
We hold coverage is triggered at the time of an injury-in-fact and continuously thereafter to allow coverage under all policies in effect from the time of injury-in-fact during the progressive damage.
Joe Harden,
however, does not establish what the relevant “injury” or “damage” is when a “damage” crosses property lines, or what the relevant “property” is that must suffer an injury during the policy period. On the one hand, the case involved only a single piece of property — a cracked wall on a condominium. Thus the South Carolina Supreme Court’s repeated references to “the damage” did not contemplate damage affecting multiple properties. On the other hand, in its emphasis on progressive damage, the court seemed to view damages as a single thing resulting from one underlying injury-causing event and stretching over time. This view would seem to contemplate the disregard of property lines. We find no help in the court’s statement that “the policy in effect at the time of the injury-in-fact covers all the ensuing damages.”
The policy language, however, resolves the question in Federated’s favor, requiring a rule that damage to the property of the underlying claimant — the condominium owners in Joe Harden and the owners of the Roshto property here — must occur during the policy period. First, the policy’s language regarding the duty to defend points in this direction. After obliging Federated to pay for damages because of property damage, the policy adds that Federated “shall have the right and duty to defend any suit against the insured seeking damages on account of such ... property damage.” (emphasis added). “Such” refers to the property damage that is the subject of the underlying suit. “Property damage” therefore means “damage to the property of the underlying claimant.”
Second, the well-established distinction between coverage for damage to the insured’s property and coverage for damage to the property of third parties suggests that the former should not trigger the latter. South Carolina law acknowledges this distinction.
See Isle of Palms Pest Control Co. v. Monticello Ins. Co.,
Finally, we note that the district court, in reaching a contrary conclusion, distorted the policy’s language and in so doing suggested that an “occurrence” (here, the fuel leak on the Chevron property), rather than actual damage, triggers coverage under the third-party liability policy. While this view is understandable as to the Chevron property— because the leak and the initial injury were simultaneous — it leads to error when multiple properties are involved. The district court quoted the policy as covering Spartan for “all sums which the insured shall become legally obligated to pay as damages because of ... an occurrence.” (ellipses in district court opinion). But the policy actually obliges Federated to pay for “damages because of ... property damage to which this insurance applies, caused by an occurrence.” (emphasis added). The definition of “property damage” in turn makes clear that the insurance “applies” only to such damage as “occurs during the policy period.” Only after so quoting the policy could the district court hold that “any liability Spartan has for the Roshto property damage would be a legal obligation stemming from the occurrence of the fuel leakage,” such that “[w]hen the Roshto property actually became contaminated is of no concern.”
Caselaw from'outside South Carolina reinforces our conclusion that the determinative date under an injury-in-fact trigger such as South Carolina’s is when the
claimant’s property
was damaged. In
Jenoff, Inc. v. New Hampshire Ins. Co.,
Although
Jenoff
involved a single property, and
American Home Products
involved bodily injuries, the rule equally holds in cases involving multiple properties. In
Garriott Crop Dusting Co.
v.
Superior Court of Kern County,
Cases rejecting this rule serve to prove the rule, because they reject the injury-in-fact trigger of
Joe Harden.
In
New Castle County
v.
Continental Casualty Co.,
Unlike these courts, we are not free to consider such policy arguments. The court in
Joe Harden
acknowledged the proof problems but found them not dispositive, because even with such problems the insured stood better off under an injury-in-fact trigger than under a manifestation trigger.
See
We thus conclude that under South Carolina law, in cases involving a standard
*811
CGL policy and progressive damage affecting multiple properties, the injury-in-fact trigger requires an insured to demonstrate that during the policy period an injury, caused by the underlying “occurrence,” occurred to the property that is the subject of the underlying third-party action. Once an injury-in-fact has triggered coverage as to
that
property, coverage is triggered “continuously thereafter to allow coverage under all policies in effect from the time of injury-in-fact during the progressive damage” to that property.
Joe Harden,
III.
Federated argues that Spartan has presented no persuasive evidence that contamination reached the Roshto property prior to January 1987, when coverage under the Federated policy ended, and that we should therefore grant summary judgment to Federated. We disagree. Because both sides have offered evidence regarding the date of migration, and because this issue of fact is the central question for coverage, further proceedings will be required on a remand.
It is true that Spartan has no direct evidence of the date of migration, but this does not now justify summary judgment for Federated. Both sides have presented expert testimony, and on the record before us we cannot say that a reasonable juror could not go either way.
See Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 252,
We reject Federated’s argument that the testimony of Spartan’s expert is deficient simply because he could not pinpoint the date of migration. We highly doubt that anyone could ever, except in the rarest cases, know the exact date of migration. It is only necessary to show by a preponderance of the evidence that migration to the Roshto property occurred during the policy period.
See Sentinel Ins. Co., Ltd.
v.
First Ins. Co. of Hawaii, Ltd.,
We also reject Federated’s claim that property only suffers an “injury” when the contamination levels exceed the maximum allowed by the DHEC. Federated so claims several times in its briefs, but never cites any supporting authority in either caselaw or South Carolina statutes. We have found none, and on the contrary think that since a state tort action for property damage from contamination (like the Roshto lawsuit) does not appear to depend on violating DHEC regulations, neither does the injury-in-fact trigger for insurance coverage.
Cf. Braswell y. Faircloth,
But the burden of proof is on Spartan.
See Joe Harden,
IV.
If on remand the district court concludes that the contamination did reach the Roshto property during the period of the Federated policy, it will become necessary to allocate the costs of the Roshto settlement. The policy itself is silent on this issue. Although the parties have pointed us to no South Carolina law on the subject, and we have not found any, we follow those courts that have concluded that the injury-in-fact/continuous trigger, such as the one adopted in Joe Harden, requires both pro rata allocation and allocation to the insured for any periods of the progressive damage during which it was self-insured.
First, as a general matter it follows from such a trigger that an insurer is only liable for its “time on the risk.” Thus, if an injury-in-fact occurs in year one, and the damage continues over three years, and if Smith Insurance covered year one while Jones Insurance covered years two and three, Smith is liable for 1/3 of the damages and Jones for 2/3, regardless of the respective policy limits. A court looks to the periods covered, not to the rate or degree of damage occurring during each period (which would involve even more difficult proof problems). This is the approach that
Joe Harden
suggests, when it explains that the injury-in-fact/continuous trigger “will allow the allocation of risk among insurers when more than one insurance policy is in effect during the progressive damage.”
Second, given the reasoning underlying the time-on-the-risk rale of liability, it follows that in any period of progressive damages during which
no
insurer was on the risk— when the insured was “self-insured” — the insured should bear the loss. To hold otherwise would be to make an insurer liable for damages that occurred when it was
not
on the risk. Thus, in
Domtar, Inc. v. Niagara Fire Ins. Co.,
If on remand the trial court determines that contamination was on the Roshto property between January 19, 1985, and January 19, 1987, the Federated policy is triggered. (If the contamination did not reach the property until after January 19, 1986,
*813
only one of the two policies would be triggered.) Federated’s liability would be a proportion of the Roshto settlement equal to the period the Federated policy or policies covered, divided by the total period of damages. The period of damages runs from the injury-in-faet — the time the contamination migrated onto the Roshto property— “until the damage [was] complete,”
Joe Harden,
CONCLUSION
Accordingly, we affirm the judgment of the district court as to Federated’s duty to defend Spartan in the Roshto lawsuit but reverse as to Federated’s duty to indemnify Spartan for the Roshto settlement. On the latter issue, we remand for the district court to determine when the contamination reached the Roshto property and, if appropriate, to allocate a pro rata share of liability to Federated, with Spartan bearing the loss for any self-insured periods.
AFFIRMED IN PART; REVERSED AND REMANDED IN PART.
Notes
. Subsequent policies included absolute pollution exclusions and so are not at issue. An umbrella policy took effect when Spartan reached the limits of its primary policy, but the terms of this policy do not differ significantly from the primary policy.
. We affirm the district court, however, regarding the duty to defend. The duty to defend turns only on the allegations in the underlying complaint. If the complaint "creates a possibility of coverage ... the insurer is obligated to defend."
Isle of Palms Pest Control Co. v. Monticello,
. The more particular issue in
Garriott Crop Dusting
was whether the claimant must have owned the property at the time the damage first occurred. Courts have disagreed as to whether the key date is when the particular claimant suffered injury (the date it purchased the damaged land) or when the property itself suffered injury (the date the contaminant migrated to the land). Since we are aware of no change in ownership of the Roshto property, this is not relevant here. Under either rule, the date of damage to the Roshto property, rather than to the Chevron property, controls.
Compare Browder,