Proving an Insured Loss: Policyholders Need Experts Too


Adjusters International Disaster Recovery Consulting

Proving an Insured Loss: Policyholders Need Experts Too

Insure for this Additional — but Necessary — Expense

By Harvey Goodman, SPPA

Accidental damage to machinery at its Midwest plant leads to a complex business interruption loss for a metal processing firm. The firm initially struggles to calculate the damages on its own. Their claim is not accepted by the accounting firm hired by the insurance carrier, whose settlement offer is only one-third the company’s calculation.

To prove their claim, it is necessary for them to seek outside assistance at their own expense, as the cost to prepare and support their claim is not covered under their policy. The company hires an engineer, a professional loss consultant and an accounting firm.


A Case for Experts

The property insurance claim has broken barriers in recent years, with far-reaching disasters that amount to enormous losses. There have also been tremendous changes to the way business gets done in a world more specialized and specific than ever before.

These trends suggest three things: That it is becoming increasingly necessary for insureds to obtain outside experts to help with claims. That qualified outside professionals can make a significant difference in the amount of a settlement and the speed with which it is reached. And that too many organizations fail to make sure their insurance program includes the coverage that will reimburse them for the costs of these services.

In this issue of Adjusting Today, veteran loss consultant Harvey Goodman examines loss adjustment fees coverage by discussing how carriers take different approaches to this important protection. He also offers recommendations to the prudent insurance buyer who wants to make sure the coverage he or she is arranging will best respond to the needs of the business. The results of this analysis are detailed in this issue.

Sheila E. Salvatore Editor