Commercial Insurance Claims

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Our client owns a large food market. Last summer, it burned down. The client submitted a claim under his business insurance policy from Farmers. The insurance policy included several different types of coverage, such as Business Property, Business Income, Extra Expense, and more. The insured had insufficient insurance limits under his Business Property to replace everything needed to reopen the market. Thus, he sought coverage for those items under Extra Expense coverage. By the plain and clear terms of the policy, these items were also covered under Extra Expense. But Farmers found an excuse to wrongfully deny the claim in a textbook example of how not to interpret and apply insurance policies in California.…
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On Saturday October 12, 2019, several decks of upper floors of the Hard Rock Hotel & Casino under construction just off Canal Street in New Orleans suddenly collapsed. As emergency personnel were engaged in the immediate efforts to rescue and aid the crews working at the hotel site, the City of New Orleans was busy implementing its emergency response teams. …
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A business interruption claim does not always end up in litigation. There are basic techniques that an insured may consider expediting and presenting a claim that may result in a fair resolution of a business interruption claim. The Business Interruption Book: Coverage, Claims, and Recovery,1 is a great source for information on business interruption issues and it provides a non-exclusive checklist to facilitate claims handling.…
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Business Interruption coverage protects the potential earnings of the insured business while its operations are suspended as a result of damage caused by a covered peril. The period of restoration has a direct effect on the actual loss suffered. A typical definition in most ISO forms of the “period of restoration” is:…
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We see many commercial insurance claims denied because the insured did not maintain a particular “protective safeguard” required by the policy. For example, a policy may require burglar alarms, and exclude coverage for theft if alarms are not working at the time of a loss. Or, a policy may require fire sprinklers, and exclude coverage for fire loss if the property does not have any. Some provisions may even allow the insurer to deny coverage if the insured failed to have a contract in place for regular service of the protective safeguard, something often seen for Ansul systems in restaurants. Courts across the country have almost uniformly upheld the validity of these endorsements.1…
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The effort to mitigate the damage, gather supporting documents, and present an insurance claim, can for many policyholders prove to be the toughest part of the recovery process. After suffering a loss or business interruption, the main priority of most business owners is restoring their businesses or premises as soon as possible – not preparing an insurance claim. While their goal is to achieve the utmost recovery in the shortest period of time, the loss adjustment process can be long and grueling.…
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After every major flood event, I am contacted by at least one business owner and/or condominium owner who suffered flood damage, filed their claim with their NFIP1 Flood Insurance Company (Allstate, Hartford, Wright Flood, Farmers, FEMA, etc.), and was then told by either the flood insurance company or adjuster that the flood insurance policy did not cover all of the buildings or structures on the property. The business owners are enraged because they were under the impression that all buildings on the property were covered.…
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