Hurricane Ike Victims Wait to Hear from Insurance Companies
In the aftermath of Hurricane Ike, power outages left small business owners at the mercy of swamped insurance companies, unsure if their much-needed claims would be approved.
On October 10th, 2008, the Houston Chronicle reported small business owners Scott Spencer, the owner of a wine shop, and Patty Larkin, the owner of Pattywhacks and Co., were still waiting to hear from their insurance companies after 4 weeks of post-hurricane stress. Spencer lost power for four days after the hurricane and $8,000 in daily sales; he has business insurance, but heard from others that "power outages aren't covered under business interruption coverage." Larkin's store was closed for 12 days costing her an estimated $10,000 in sales and after her insurance company told her the loss would not be covered and then backtracked saying it might be covered, she still awaited a final decision.
Where homeowners insurance typically provides the same coverage for everyone, business insurance is much more convoluted. In addition to finding a way to make up for lost revenue, small business owners like Spencer and Larkin had to learn the ins and outs of business insurance and how to deal with their insurance agents. Business interruption coverage protects companies in the event of a disaster or other circumstance that stops normal business, but only if the damage resulting in the halt is covered in the policy, like wind or flood, for example. Also, most small businesses don't have insurance for loss of market, which refers to a loss in revenue due to regular customers moving out of the area or to another company offering similar products or services, simply because they are open. These are only a couple of examples of the complications and nuances inherent in hurricane insurance claims.
Insurers are required to accept or deny claims within a stipulated period of time and, if they intend to deny a claim, must notify the policy holder of the reason for denying the claim. If the insurer is unable to determine whether a claim will be accepted or denied they must inform the policy holder of their need for additional time.
Hurricane Insurance Litigation
Figuring out how to approach insurance malpractice and pursuing hurricane claims against big insurance companies can be frustrating and intimidating. At Arnold & Itkin LLP, our attorneys have years of experience and expertise litigating successful insurance malpractice lawsuits against some of the biggest insurance companies in the nation.
If you or a loved one has been denied rightful claims by an insurer, contact an insurance attorney at Arnold & Itkin LLP for a free consultation.
