Only insurance company claims managers and their paid for lawyers could argue that a hail dented roof is not a covered loss under a property insurance policy which specifically covers hail damage. A federal appellate court decision issued last week1 helps put an end to these crazy attempts by insurance company lawyers that argue virtually anything to get out of the contractual promise.


Continue Reading A Hail Dented Roof is Covered Direct Physical Damage and Loss

One area of dispute in property insurance claims involving hail or storm damage is how much needs to be replaced. When part of a building’s roof or siding is damaged as a result of a storm, sometimes the replacement material is no longer available. The issue becomes does the entire roof or siding have to be replaced in order to achieve a perfect match?


Continue Reading Important Decision in Favor of Policyholders on Matching Issue

For coverage to be afforded under insurance policies there is a requirement that the insured property suffer a direct physical loss from a covered cause of loss. This often leads to disputes and litigation concerning whether property suffered a physical loss. Insurance carriers argue that a physical change in the insured property must occur before coverage attaches. Policyholders, however, often have damaged property and business interruption without a physical change to the insured property. When is coverage provided in such circumstances?


Continue Reading Federal Court Expands “Direct Physical Loss” Definition to Benefit of Insureds

Shane SmithWhile a majority of property insurance claims involve homeowners or commercial property owners whose buildings are damaged by hurricanes, floods or windstorms, it is not unheard of for a golf course to sustain damages as result of these types of perils. This subject matter is of particular interest to me because of my golf background. Prior to my becoming an attorney, I played collegiate golf at Notre Dame and also competed professionally on a developmental tour for the LPGA. During my golf career, I was fortunate to have the opportunity to travel and play some of the most challenging golf courses in the country.

For those of you who may not be avid golfers, the difficulty of a golf course is determined by a course and slope rating which is calculated for each set of tees. These ratings are not only important in calculating a golfer’s handicap for the course but are also considered by those who rank the top golf courses.


Continue Reading Coverage for “Direct Physical Loss or Damage” Under a Policy Does Not Include Cost to Re-Design or Modify a Golf Hole To Restore its Difficulty

I find it amazing in first-party property insurance that even after one has handled thousands of claims, new issues surface involving the same policy language dealt with over and over again. When such issues present themselves, the cynic may think: is the proponent of this argument clueless? The pessimist may wonder: have I missed something during this journey before? The optimist may think maybe this is just why we are involved in this exciting practice! That’s not too idealistic of an approach is it? You be the judge. With that said, I would like to elicit some feedback from those that follow this blog.


Continue Reading What Is Direct Physical Loss That Results From A Covered Peril?

On the night of October 29, 2012 the “kings of the hill” in New York knew that they would not be waking up to a City that Never Sleeps. In fact, the lights were out for weeks and the businesses that were at the top of the list – now have to make a brand new start of it.

Continue Reading There is Coverage for Business Income Losses Caused by Power Outages During Hurricane Sandy

“In this business it takes time to be really good – and by that time, you are obsolete” – Cher


A recent article in the Insurance Journal magazine, “Industry Faces Cyber Risks in Shift from Tangible to Intangible Property,” highlights the urgent need for new underwriting products and guidelines to keep up with the constantly evolving technology changes.

Technology has moved so rapidly that not only the insurance industry, but also business in general, is now facing a sea change in the way all types of data, including personal and corporate information, is collected and stored. How well re/insurers deal with this new reality could well determine the industry’s future course.


Continue Reading Industry Cannot Keep Up With Cyber Perils – Understanding Business Interruption Claims

After spending the past several weeks looking at common exclusions to the all-risk policy, this week’s blog will focus on more basic requirements that must be met in order for coverage to exist. Some will seem very straightforward, but others actually raise interesting legal issues when the right circumstances arise.


Continue Reading Basic Thresholds to Coverage: Deconstructing the All-Risk Policy

Coverage that excludes electronic data serves very little purpose in today’s business world. Many businesses have abandoned physical storefronts and the familiarity of face-to-face transactions and operate exclusively in the cyber world. Even businesses that operate out of physical buildings or structures no longer store information in filing cabinets, but in servers and electronic files that contain crucial and often irreplaceable information. I can’t imagine anything more frustrating than having to tell an impatient customer that you cannot fulfill their needs because your computers are down. With respect to the products offered, the insurance industry has done little to keep with the times. Smaller businesses are often forced to choose generic first-party ISO forms that exclude coverage for damage to electronic data (caused by e-perils) because such coverage is simply unaffordable.


Continue Reading The “Physical Damage” Requirement – An Archaic Concept in Today’s World – Understanding Business Interruption Claims, Part 57