I would like to share with you what I have been experiencing while processing a particular insurance claim. It is regarding water damage to 80% of the total area of a building, including the upstairs and downstairs areas, because of a burst water pipe which was located above the ceiling on the second floor.
It is a business property and the damage occurred during a time when the lease had been in negotiations for many months.
At the time I started working on this case and inspected the site, I found that the business equipment and inventory inside the building had been left alone for more than 6 months, just collecting dust, and it looked no different from a business that was shut down.
Although it should have been a given that the insurance company would calculate the appropriate amount and compensate the insured for the loss of lease revenue, the insurance company had not compensated them a single penny for the reason that the building was not being leased at the time.
The first thing our company did as we began to execute this claim was to request all the documents on the claim and to analyze them. And, because it seemed unfair, I called the inspector at the insurance company who is in charge of this claim.
I asked him if he had personally gone out to see the site since he had been working on this case for quite some time. He asserted that, because he hired a 3rd party construction consulting company and left the matter entirely with them, he did not feel the need to go out and see for himself. I then asked him if he was the one who was also handling the claims on the loss of income and business equipment and inventories, as well as the building damage. He admitted that he was the one handling those claims as well.
I asked him, as the person in charge of this claim, if it was reasonable for him, considering that the business had been a solid one, to just leave the equipment and inventory untouched, letting them just collect dust when he had not even finished checking the repair cost on the damage incurred? How was he going to compensate them for the damage incurred to their business reputation? Why was he refusing to compensate them for the loss of income even though there was a clause in the contract that said that they can request loss of income even if the building was not leased out at the time of the water incident?
Was it not common sense that their business income would reduce as a result of the damage? Why had he not notified them of their right to be compensated for the income loss according to the provision in the insurance contract?
In short, he replied that, because the insurance member did not request it, he did not take any action. Fortunately, since this was discovered within the period covered by the insurance, they should not have any problem receiving their compensation.
Without hesitation, I told him that the fact that he did not go visit the site was an act of intentional evasion of an important duty of the insurance agent, and that he could be reported to the state insurance bureau for this negligence. He immediately responded, with a trembling voice, that he was just an employee of an insurance company.
I told him that within a week, I would be sending a professional company experienced in handling business properties to the site to clean all the business equipment, make a list of the equipment, and store them at a specialized storage with air conditioner. I also told him that I would be making a request for the total cost of replacing or repairing the equipment depending on the level of damage, and would be negotiating not only the compensation for the building repair cost, but also for the loss of income as soon as we received the previous year’s bank statement, and thereby quickly settle this case.
I believe that if this claim were that of a mainstream business, they would not have processed the claim to this degree of unfairness.
Jung Park, PA
Excel Public Adjuster