At the dawn of the 2006 hurricane season, American businesses will find that last year’s Katrina-Rita disasters have left behind troubling obstacles to recovery from yet another wave of predicted destruction, according to Dallas-based Haynes and Boone LLP Insurance Coverage Practice Group.
For one thing, simply finding available insurers has become much more difficult. And, even when carriers can be located, some now offer much lower coverage limits.
“The property insurance market has changed dramatically as a result of last year’s storms,” says Ernest Martin, head of the Insurance Coverage Practice Group. “Additionally, disputes with major insurance carriers over last year’s disasters are just beginning to mature as we embark upon this new hurricane season.”
Many companies are still combing through and, where possible, negotiating important provisions of insurance policy fine print that will result in major ramifications for hurricane and flood damage relief this year and beyond.
“The devil is in the details,” says Martin. “Each document is different. We have had to help our clients grasp the nuances of disaster and business interruption coverage available under their policies. And, in the case of Katrina, its magnitude and peculiarities led to coverage issues that are seldom raised.”
Businesses would be well advised to take important steps as the 2006 season gets under way, according to Martin. Among them:
*In securing renewal coverage, a company should take steps to negotiate more favorable terms where possible.
*Understand policy exclusions and how they work. Mold and flood exclusion clauses alone can wreck attempts to rebuild.
*Investigate current deadlines concerning existing claims. Texas and many other states require that insurance companies investigate and settle with clients within a reasonable period of time. Knowing about those pressure points could prove vital.
*Secure commitments now from forensic accountants and other professionals needed during the recovery process.
Source: Haynes and Boone LLP
Was this article valuable?
Here are more articles you may enjoy.
Cracks in O’Hare Columns Aren’t Insured Property Damage, Just Bad Product – Court 
Reserve Strengthening for Casualty Lines Not Over: Moody’s 
Update: Fannie Mae Guidelines Raise Concerns, Could Bar ACV Coverage for Homes 
Insurer Chubb Readies $350M Payout Tied to Baltimore Bridge Collapse 
