Property Insurance Claims: Negotiating Unfamiliar Terrain

ADJUSTERSINTERNATIONAL.COM 5 continued to increase at the same rate had the fire not occurred? Will the market bear an 8 percent price increase, assuming no more people eat at the restaurant? Is the capacity and turn rate of the restaurant such that 8 percent more meals can be served? Is there new competition? It is likely that the insurance company will raise these or similar issues. Remember that business interruption calculations are built upon a foundation of subjectivity. Some common issues often raised include: · How long is your loss period? · What would your sales have been if your loss never happened? · What would your expenses have been if your loss never happened? · Did you incur any extra expenses or expediting expenses that are recoverable under your policy? Issues like these, which could also be subject to policy interpretation, should not be determined by the insurer alone. Post-Loss Checklist • Mitigate your loss and protect the property from further damage. • Move quickly to save special property such as books, manuscripts, etc. • Notify your insurance company. • Control access to the premises. • Retrieve any computer data from backup or hard drives; data is often retrievable if you act quickly. • Photograph and/or videotape the premises. • Establish a claimmanagement team, with one spokesperson. • Evaluate the insurance policy and prepare a claim strategy to protect your operations and market. Make sure all teammembers know their responsibilities. • Channel all communication through the designated team leader. • Notify your customers, banks and suppliers. • Prepare a public relations program to inform all stakeholders and the general public. • Document your activities in a log and maintain detailed records. • Set up a special general ledger account to track all loss-related costs. • Integrate the claimmanagement program with the post-loss operations. • Know the players; know who the insurer’s representatives are. • Understand your duties and requirements. • Take a proactive position; you must make the claim. • Hire your own experts. • Be aware of the impact that your preliminary estimates might have on the insurance company’s reserves for your claim. • Do not rely solely on your historical records; secure current replacement estimates. • Understand that your claim needs to be verified; understand the negotiation process. • Coordinate and integrate the property, business interruption and extra expense claims. • Concentrate on maintaining your operations and not on preparing claim details — leave that to the experts. • Apply for a property tax reduction while the building is not usable. (May not be possible in all locations.) • Refrain from quick, spur-of-the-moment settlement deals. Take time to evaluate the settlement offer thoroughly, on your own. • Be careful if asked to sign a general release as part of your settlement. You are entitled to collect your loss payment just by filing an agreed proof of loss.