Power Outage Liability

Today a construction company cut a major underground power line that serves a number of homes and businesses in our area. We have implemented our standard power outage procedures, and are taking measures to protect our perishables, but the report is that it may take ‘quite some time’ to fully repair the line. This has already caused us to close for lunch, and may very well effect dinner as well - thus losing out on a day’s revenue, a day’s wages for our staff, and possibly lost product if this becomes an extended outage. We do have loss of business insurance (with a deductible) but it only covers losses after the first day, so any losses today would not be covered.

What do you guys think - is there liability on the part of the construction company such that we could take action against them? Might it simply be a claim by us against their insurance? Do you foresee an uphill legal battle?

I’ve dealt with weather related outages before, but this is the first human caused outage. Anyone have experience with this?

Thanks - Eric

Under your policy there will be a “subrogation” clause…This means once your claim is handled by your insurer, they will pursue recovery if they can find a “negligent” party…Your insurer will usually “piggyback” your “uninsured loss” along with theirs…

And just because the construction company did it, does not mean they were “negligent”…For example. it may be that the maps they were working with were wrong and another party is responsible…But your insurer will make that call and determine if it is worthwhile trying to recover from whoever they can…If they do not, it is probably an “uphill” battle to attempt this on your own…

Document everything you can…And “good luck”…

PS…Former insurance adjuster speaking…

Are you gaining?..

Royster, they actually ended up getting it fixed quicker than they anticipated. We lost part of the lunch daypart, but not entirely. Unfortunately probably not enough of a loss to be worth the hassle of pursuing.

Glad to hear it did not turn out too bad…