An April fire destroyed the inventory and warehouse of a manufacturer and distributor of Christmas decorations. When we examined the policy, we noted several problems with the insurance coverage and major variations in the policy from the agent’s quotation. We worked with the insured, agent, and insurance company over a six-month period to correct the errors. The reformed policy netted the insured more than $600,000 over the payment they would have received under the original policy. More important, we worked with the insurance company’s adjuster to allow the insured to begin to restore the buildings immediately. The insured completed his work by the end of July, in time for the Christmas selling season. Net result—the company was saved and its rights for recovery were fully protected.
Manufacturer
A manufacturer of industrial specialty products had a fire that destroyed a unique machine that was the heart of its operation. The insured thought he might have to declare bankruptcy. On our advice, he made a deal with his leading competitor to produce his product for him at a premium to give him time to repair the machine. Net result—the company was saved and the insurance policy’s extra expense coverage paid for much of the added cost to our client. A year later, the insured sold the firm for over $1 million.
Restaurant
The night before a frigid New Year’s Day, a water pipe burst and flooded a large restaurant. We documented the loss with photographs and hired a cleaning company to remove the residual water. The carpet and some of the fixtures had to be replaced, but the restaurant only lost one day of business. Result—a happy insured who was compensated for his property loss and was able to continue to serve his customers.
Yacht Club
A yacht club suffered a devastating fire that resulted in a total loss to the club and pilings under the club, and substantial loss to the docks. The insurer initially tried to deny coverage for the pilings under the club. Working with the agent, we persuaded the insurer to provide coverage. The lawyer who represented the club said that we were not entitled to the supplemental coverages in the policy. In fact, the amount we collected for these coverages more than covered our fee. As a result, the club will be able to rebuild the facility.
Employment Agency
Thieves stole several computers from this firm. One of the computers contained a valuable prospective-client database, which was not backed up. It took over two months to recreate the database. The insurance company’s accountants refused to pay anything because standard accounting methods indicated that there was no loss. We developed three methods of modeling the company’s business. The third model clearly showed a substantial loss and the insurer finally agreed to pay a satisfactory settlement. Result—a happy client and a satisfactory settlement without resorting to arbitration or court action.