RESTAURANT FIRE

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PostPosted: Sat Sep 01, 2007 2:39 pm   Post subject: RESTAURANT FIRE  

Hello,



I own a HVAC Company and performed some work at a Restaurant. The HVAC Unit we replaced caught on fire during our startup procedures. It is unknown at this time what caused the fire.



The fire spread like a mad enferno causing some serious damage in excess of a million dollars. I have been told the building will have to be rebuilt from the ground up which would cost much more. Nobody got hurt.



I am very worried because everyone and their mother is going to point blame at my company. My business liability coverage is one million and general aggregate of 2 million. Can someone explain to me if this is sufficient.



What happens if my company is found at fault? My insurance company has appointed me an attorney who is employed by the insurance company. Is this attorney really looking out for my best interests?


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PostPosted: Sun Sep 02, 2007 12:14 am   Post subject:   

It's unusual for an insurance company to appoint an attorney before a suit is filed or unless there is a fatality. But in the case of a multimillion dollar loss, I could see the need. One reason is that all the information will go through the attorney and then to the adjuster so that it becomes "privileged" and many not need to be released to the other parties if a suit is filed.



With a loss this large, there is a good possibility it will go to suit. This is mainly as there are probably many people involved who _could_ be at fault. Even the manufacture of the HVAC unit could be responsible in some way. With all these people it's possible that they all may not be able to agree on who is responsible and by how much.



I understand your worried but there is not much anyone can say at this point. We don't know exactly what happen, why it happen, who was involved, etc. What I can say is this... most likely the restaurant has insurance to initially address the loss and <shoot> will most likely file under their own policy. If their carrier determines you were responsible they ask your carrier for your share of the loss. If this is a million dollars (or more) and your carrier agrees, you carrier will ask the restaurant's carrier to sign a release in return for the million. This release would settle the matter and you would not owe anything else. If the restaurant's carrier wants more then million and won't sign the release, then they would take you to court. Almost always they accept the policy limits as it cost too much to go to court. Also, how much more would they get from your company? Probably not as much as it would cost them to win a suit.



All of this is _way_ down the road and all up in the air. Let your carrier investigate the loss and determine _exactly_ what happen to have caused the fire. A million dollar policy is pretty standard and will settle most any loss.



Is the attorney on your side. Yes! He/she is _your_ attorney... just being paid by the carrier. The attorney is ethically and legally bound to protect your companies interest in the matter. This is no small deal. Attorney take this _very_ seriously. Now the attorney will cooperate with your carrier almost all the time as you have the same interest. But if your interest is not the same as the carriers, the attorney will butt heads. This is actually good for the carrier and what they want. It prevents you from filing a bad faith claim against them (which might be another reason why they hired the attorney).



Feel free to post any other questions as this claim moved forward.

tcope
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PostPosted: Sun Sep 02, 2007 4:24 pm   Post subject:   

Worried, we were appointed an attorney before suit on an auto accident, and the attorney was winderful! They don't want to have to pay out any more money than they have to, or even if they need toat all, so they ar working hard to prevent this.



Like someone else mentionded, the company that built theHVAC may have some fault in this,too. I would address these concerns with your attorney, and any others you may have.



Out attorney kept us up to date all the time, and also was very patient with me when I had questions.



Take a deep breath, ther's nothing you can do for now. Stay abreast of what is happening with this with your attorney, and let us know what happens!..Karen

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PostPosted: Sun Sep 02, 2007 5:14 pm   Post subject:   

Patient with you... because every minute they spent on the phone was billed to the insurance company at attorneys rates! Laughing



Seriously. A 30 minute call can make the attorney a hundred dollars.

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PostPosted: Sun Sep 02, 2007 5:27 pm   Post subject:   

You're probably right! I was just glad our rates never went up at all!!..Karen

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PostPosted: Sun Sep 02, 2007 5:29 pm   Post subject:   

Thanks for the responses. I failed to mention that I also carry an Excess/Umbrella Liability each occurrence 1 million and general aggregate for 1 million.



The appointed attorney from my insurance company also said worst case scenerio I would have to close my business and restart under a new name. This of course did not make me feel good one bit. I feel everything Ive built will be taken away from me if we are found at fault.



Ive also been told I will be receiving a reservation of rights letter. What does this mean?



Thank you very much and I will keep you posted with everything that occurs.


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PostPosted: Sun Sep 02, 2007 5:51 pm   Post subject:   

Hi Worried,

Its good to know that you were helped by the community. BTW, why dont you sign up so that it helps you to keep us updated more conveniently. Smile

Regards,

Lakemen



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PostPosted: Sun Sep 02, 2007 7:22 pm   Post subject:   

As you probably know, certain things are not covered under your policy (example: if you intentually caused the loss, etc). If the insurance company gives you the impression that the loss is covered under your policy and makes you think that there are no issues, they may waive their right to apply any exclusion that is listed in the policy. This "impression" is as simple as investigating the loss. When your dealing with a loss that may cost the insurance company a million dollars, they are going to "reserve" all their rights under the policy. This is typical and happens all the time, especially on these larger losses and when the loss is of a nature that no one yet knows what caused it.



IMHO- the ROR should be specific. That is, it should name the exclusions under the policy that may apply to this case. Once you get the ROR, make sure your attorney has a copy and see what he/she can tell you.



Defense attorneys will actually give you the worst case situation... and it _will_ be the worst case even if it's a billion to one. If they did not, you might later have a complaint against them for not explaining the situation properly as they should have. So don't be too concerned right now. This will be a long and drawn out process and it's common that it could take a year of more before anything really goes anywhere.

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PostPosted: Sun Sep 09, 2007 12:28 am   Post subject:   

Is the appointed attorney who is employed by the insurance company really can help you for your insurance compensating. I think the lawyer maybe equitable or lean to his insurance company . so , i advise you to privately employ a other lawyer.

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PostPosted: Sat Sep 29, 2007 2:35 am   Post subject:   

Just an update.



I consulted with an attorney on the matter and hired him to represent me. My attorney was able to have the reservation of rights letter withdrawn by the insurance company.



This is great news for me as now my insurance co will defend me to the end. The insurance company had 2 choices-1. withdraw the reservation of rights letter and continue to defend me with their own attorney or 2. Keep the reservation of rights letter open and hire my attorney at their wages.



I'm not as worried anymore.


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PostPosted: Sat Sep 29, 2007 4:26 am   Post subject:   

Hi Worried,



It's nice to know that your problem is finally over. Hope you will have a smooth journey ahead. Meanwhile, keep visiting ampminsure.



Regards,

Juanita

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