Property manager’s fees are normally considered “continuing expenses” in business income claims. The standard Business Income (And Extra Expense) Coverage Form CP 00 30 04 02 says, "We will pay for the actual loss of Business Income you sustain due to the necessary ‘suspension’ of your ‘operations’ during the ‘period of restoration.’" Business Income is defined as:

  1. Net Income (Net Profit or Loss before income taxes) that would have been earned or incurred; and
  2. Continuing normal operating expenses incurred, including payroll.

Continue Reading Are Property Manager’s Fees Recoverable? – Understanding Business Interruption Claims – Part 52

I ran across an article in the National Underwriter publication, FC&S Bulletin, regarding a situation where the insured experienced a “slow down” in its debt collection operations after a lightning strike. The problem was discussed as follows:

Continue Reading “My Phones are Down” – A Coverage Disagreement – Understanding Business Interruption Claims, Part 45

A recent IRMI article titled “Limiting the Interruption in Business Interruption” discussed the importance of considering payroll during the risk assessment phase of obtaining business insurance coverage. The forms regarding business income and ordinary payroll are hyperlinked for ease of use and understanding.

Continue Reading Considerations Regarding Ordinary Payroll – Understanding Business Interruption Claims, Part 43

Many of our clients come to our doors with perplexed looks on their faces and denial letters in their hands. Dizzied after a long battle with their carriers, which our clients seemed to have lost to purported words in their policies that they are presumed to have bargained for, they come to us for understanding and hoping that the policy they purchased is not a pamphlet full of meaningless words.

Continue Reading Never give up – A Jeweler’s Story – Understanding Business Interruption Claims, Part 41

Proof of loss requirements are becoming a more frequent topic of conversation, and questions regarding proofs of loss are frequently asked of members in our law firm. Proofs of loss are conditions precedent to recovery under virtually all property insurance policies. Unless waived or not demanded under some forms, proofs of loss should be filed.

Continue Reading Can Insurance Companies Demand Multiple Proofs of Loss?

After non-catastrophic losses, most insureds are able to restore operations in a fairly short period of time. In those cases, the measure of recovery will be limited to any business income loss and incurred normal operating expenses during the period of restoration. However, in many cases, businesses are not able to return to their pre-loss income levels after they resume normal operations for weeks or months to follow.

Continue Reading The Value of an Extended Business Income Provision – Understanding Business Interruption Claims, Part 38

Property insurance policies are written in complex language. The fact that there are so many different interpretations and disputes about the language by some very bright people is probably enough evidence to prove that point. David Rossmiller wrote a post, Corban v. USAA: A few (more) words about anti-concurrent causation, which had me thinking about words used in an insurance policy and what a policy covers. He stated:

Continue Reading Does an Insurance Policy Cover Only “Loss” or “Damage” to Property?

This morning’s edition of Business Insurance has an article, Claims Could Get Messy After Huge, Costly Oil Spill, which explains that insurance claims are going to be complex and that the cost will certainly be in the billions. My reading of a FC&S discussion on the issue of "pollution" exclusions in homeowners policies indicates the same thing. Indeed, given the definition of a "pollutant" in the standard form policies, one may question whether oil escaping in a natural form would be a "pollutant."

Continue Reading Oil Spill Insurance Claims Will Be Messy and is Oil a Pollutant?