Magazine article Risk Management

10 Tips for Dealing with Insurance Coverage for Hurricane Losses

Magazine article Risk Management

10 Tips for Dealing with Insurance Coverage for Hurricane Losses

Article excerpt

When hurricanes hit, many insureds have to scramble just to preserve lives, their facilities and other property. Insurance coverage is often not the first consideration, but it can be an important one for rebuilding a business. Insureds should adopt practical approaches that can help ensure that they obtain the full extent of insurance coverage available for hurricane-related losses. Here are 10 tips:

1. Know Your Policies

Know how policy provisions work together and when coverage starts- for example, from actual physical inception of loss or from a specified time before a hurricane arrives.

2. Notify the Insurers as Soon as Possible

Have methods in place to reach out to insurers as soon as it becomes apparent that there is - or may even be- a loss. Notice to insurance brokers may not constitute notice as required under the policies. Determine in advance what notice is required and to whom it must be given.

3. Keep Critical Document Copies In Separate Locations

Keep insurance policies or copies, including endorsements, in safe, separate locations. Electronic copies should be considered and always backed up of site.

4. Watch the Attorney/Client Privilege

Remember that in many jurisdictions, communications with an insurance broker are not necessarily subject to the attorney/client privilege. Likewise, internal communications that are not for the primary purpose of obtaining or receiving legal advice may not be privileged.

5. Check Provisions Regarding Adjustment Expenses

Many policies provide that loss adjustment expenses may be insured. There are limitations on this coverage, however, including dollar limitations and, in many instances, limitations that preclude or limit coverage if professionals providing loss-adjustment services also are serving in the role as an "advocate" for coverage.

6. Document Losses

To the extent possible, maintain detailed records of various losses and expenses incurred in dealing with the losses. Watch characterizations as well, keeping in mind that individuals not involved with insurance may not know policy requirements or terminology.

7. Policies for Deadlines and Other Time Traps

Many policies require that proofs of loss be provided within a period of days (often 30, 60 or 90 days) from inception of the loss. The loss could be deemed to incept upon first impact of a hurricane or, in some instances, even before the hurricane arrives (for example, if there is a pre-hurricane evacuation or curfew). …

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