Commercial property insurance protects businesses from damages to their office buildings, storage facilities, warehouses, equipment, and furniture. The policies typically cover damages caused by a variety of hazards or “events” including fire, wind, smoke, flood, theft, and bursting pipes. The policies also sometimes cover damages attributable to “business interruption” that allow the insurer to recover revenues lost while deprived of the use of the business premises caused by a covered event. However, simply having such a policy is no guarantee that any or all damages sustained by an event will be covered.
Insurers often employ a variety of questionable tactics when handling commercial property claims including woefully underestimating the actual damages to the property, arbitrarily blaming the damage on an uncovered event, denying business interruption by capriciously asserting that the business could have continued operation despite the damaged premises, or asserting erroneous interpretations of the insurance policy or applicable law to support a denial of coverage. Commercial property insurers will often attempt to mitigate their business interruption exposure by erroneously invoking “mandatory evacuation” or “civil authority” clauses that are clearly inapplicable. However, when the insurer employs these questionable tactics, you are not bound by their arbitrary conclusions and determinations but have recourse available if you are knowledgeable of your legal rights. For example, you are not obligated to accept an insurer’s lowball estimate. Some policies allow the insured to request a second damage assessment if demanded within a prescribed time period. In addition, the insured with the assistance of competent legal counsel can hire an independent adjuster to fairly assess the damage, which often encourages the insurer to reconsider its original damage assessment. Other experts can also be retained to controvert insurers’ erroneous conclusions that an uncovered event caused the damages sustained or prevented you from operating your business as usual.
Once you and the insurer finally agree to the amount of your losses, the battle is usually far from over. If and when the insurer finally agrees to cover at least some damage, it may delay payment to the insured based on a variety of pretexts. Most jurisdictions, including Louisiana, have laws that strictly mandate the time frame within which an insurer must adjust and subsequently pay a damage claim. Ignoring such time limitations can subject the insurer to penalties for bad faith claims adjusting, attorney’s fees, and court costs, if applicable. Therefore, it is extremely important to know your rights and obligations when submitting a property insurance claim to maximize recovery and to avoid arbitrary or baseless claim denials. The Hurricane Legal Group has considerable experience in evaluating, handling, submitting, and litigating a variety of commercial property insurance claims on behalf of its clients.