I recently got interviewed by Ed Beeson of the Newark Star-Ledger as part of his article about the looming Superstorm Sandy insurance coverage litigation. The insurance industry has definitely circled the wagons, and the first suits are now being filed. There will be a lot of battles over causation (e.g., wind versus flood), as well
Property insurance
Flood insurance and basements
By Gene Killian on
A group of owners of hurricane-damaged homes have brought a putative class action in federal court in Newark, arguing that their flood insurance carriers are short-changing them by calling their first floors “basements”. The case is Donnelly v. New Jersey Re-Insurance Co., Docket No. 12-cv-7629, and was filed by Union City solo Jeffrey Bronster.…
Business interruption insurance and Hurricane Sandy
By Gene Killian on
Posted in Business Interruption, Property insurance
When Hurricane Sandy struck New Jersey last week, one of my out-of-state lawyer friends, employing the sort of dark humor that perhaps only other lawyers can appreciate, congratulated me on my “happy positioning in the world’s greatest business interruption insurance goldmine.” I told him that, unfortunately, this time I might be a plaintiff instead of…
Actual cash value and replacement cost
By Gene Killian on
Large first-party property damage cases often come down to a battle of accountants. In other words, unlike Olympic beach volleyball, they’re usually not particularly thrilling to watch. (Not that I have anything against accountants.) But the results of the battle can have a major impact on the policyholder’s balance sheet. How is the policyholder’s claim…
Bad Faith Insurance Claims Handling
By Gene Killian on
Here’s a question that perhaps should be posed to a magician: How can an insurance company turn an $85,000 claim (on a policy with a $100,750 applicable limit) into an $850,000 bad faith verdict? If you’re Merrimack Mutual, apparently it’s quite easy.
I wrote about this case some time ago when the jury verdict first…
Coverage for “stigma” damages
By Gene Killian on
Posted in Contract construction, Property insurance
Let’s say you own a factory building. Construction activity on an adjacent lot causes damage to the structure. You have the standard first-party property insurance policy providing coverage for “direct physical loss or damage,” and the policy gives the carrier the option of paying either the “cost of repair” or “loss of value.” If the carrier…