Business Interruption Insurance............

[GotRocks]

Have your agent explain any and all exclusions to coverage.

I recently learned that “Downed Power lines” are excluded in my policy unless the lines are down within 1,000 feet of the building.

If your insurance agent does not have you properly covered, there is legal remedy through a malpractice suit, I’ll let you know how that goes as it progresses.

 

[royster13]

How long was your interruption?..Was it long enough to make a claim worthwhile and incur legal expenses…

Another consideration is how does a claim and/or legal action affect your renewal?..You may find that your current insurer will not offer a renewal…And when you go to market for a new policy your claim may be taken into consideration…This may make it difficult to find a new policy and/or cause your premiums to be much higher…

Good luck…

 

[bodegahwy]

That 1000 foot exclusion is nuts. If the power is down why should it matter where the downed line is?

 

[GotRocks]

@bodegahwy Exactly! Blown Transformers are covered, as are a litany of other things , but if it is “Downed Lines” it is excluded. There was some serious dumbassery from my agent on this one, I cannot go into depth due to the pending litigation against her for this, I will be made whole one way or another, and the whipped cream and cherry on top is if I can have her insurance license revoked.
Did I mention that I hold a grudge?

@royster13
My losses were upwards of $30K for the weekend due to this 30 hour power outage. This is loss of revenue and perishable stock, I had several catered events we were supposed to do that we couldn’t, and that could have put me in a highly actionable position for breach of contract.
I was in every 2 hours checking temps in my cooler(s) and when my products exceeded 41 degrees, the countdown started. I considered some other options to try and move the product before it got to the point of time/temp abuse, but with no running water for warewashing, handwashing, and general sanitation, I decdied it was not worth the risk, and thinking “Ya know, I’m insured for this kind of problem”

There will be a malpractice suit brought against this agent for this. Not even 10 days earlier I met with her to discuss my various coverages, I specifically asked if there was any scenarios where I would find myself without coverage on business interruption, I was assured that there was no gaps for even the most unlikely occurrences, then when I made the claim on Monday morning, I was told otherwise by the adjuster.
30 minutes Before this storm hit us, I put a call in to my agent to make sure there was coverage for power loss, I was told everything is covered, and to “Relax” and to not worry about it because we are covered for everything.

, We run on 408 volt 3-phase power here, so it’s not like I could run to Home Depot and grab a portable generator. The unit I need to power this place is upwards of $25K for the unit, plus install, crossover panel, and various other costs. Hence, Why I paid for business interruption coverage and product loss coverage.

 

[noreason]

That sucks… I’ve been thinking of buying business interruption and its shit like that which makes me second guess it.

Last Friday we lost a fuse (also three phase) on one leg of our power so everything was running half assed. We were screwed and had to close until about 7pm.

 

[royster13]

The 1st hurdle will be a finding that the broker is somehow “negligent” and therefore liable for your losses…Sounds like on this front you will be okay…

Then comes a determination of your losses…

As far as lost revenue, that will not be the basis of settlement…A liability claim will be settled on the basis of “actual loss sustained”…So essentially your loss of profit…How much lost revenue did you have and how much profit did you make on that much revenue last year?..

As far as being sued by your catering clients…Maybe, but probably little chance of success…I would think “force majeure” would apply and you should pretty much be off the hook…The lines coming down were certainly out of your control and that is pretty much “force majeure”…

Lost perishable stock is quantifiable…But there is also an obligation to “mitigate” your loss…You certainly do not want to tell anyone “Ya know, I’m insured for this kind of problem”…That is almost an admission you did not mitigate because it would be someone else’s problem…So you will have to convince them it was not worthwhile to try to save your stock…

My comments are based on my years as an insurance adjuster (many years ago now) and not be exactly correct…So you obviously need to do much more investigation on your own…Good luck…

PS…As far as the broker losing her licence…I wouldn’t count on the “whipped cream and cherry on top” as some of the brokers I adjusted E&O claims for worked for many years after making their mistakes…Mistakes happen and that is why they have E&O insurance…

 

[GotRocks]

Catering; We have a 3 page contract that spells out the responsibilities of both parties, it is not a lopsided contract that favors only 1 party, luckily our clients understood the issues and mediation is not required.
As for loss of stock, I considered bringing in my mobile catering gear to the restaurant and cooking serving everything that we could serve safely, but we had no running water for sanitation purposes, so no restrooms, no handwash, no warewash capabilities we were dead in the water and could not safely and legally prepare and sell product.

There are other factors in play here too, it turns out my premiums were nearly double of what I should have been paying for the last 3 years due to this agent “Misidentifying” a crucial piece of our cooking equipment and naming it a “Charcoal Grill” as opposed to the NSF approved, UL listed for 'Zero Clearance from combustibles" commercial appliance that it is. So I should be seeing a huge rebate too.
I have my entire file being forwarded to my attorney, including her hand-written notes. This particular agent was recently released from the insurance agency due to her less than stellar performance,
So the Snarky condescending attitude that I always got from her is coming back to bite her right in the arse. Karma can be a real SOB…