Insurance companies love to inform policyholders that the use of an independent loss assessor is at your own cost, we wonder how true this is within this case study?

We acted on behalf of a restaurant owner after their restaurant had been flooded. The flood occurred at 8pm on a Saturday evening which resulted in them having to send home paying guests and led to them having to cancel the guests that had booked their meal for 9pm that evening.

The premises were also closed for the subsequent three days afterwards which meant it reopened on Wednesday that week.

The first issue within this commercial insurance claim was who was responsible for the repair of the property damage within the building as the property was leased the restaurant owner didn’t own the building however had a verbal agreement with the landlord that they would fix any damage within the building should an issue arise. This sounds simple however the lease agreement stated otherwise and the insurance company’s loss adjuster tried to capitalise on this in an attempt not to make any payment for the buildings claim under our clients policy.

This got into a very technical issue which we did succeed in getting our client compensation for their loss, basically insurable interest arises through two separate ways which are,

• Common law.
• Contract law.

Insurable interest at common law sometimes is automatically presumed to exist. For example, everybody is presumed to have an unlimited interest in their own life and in property they own. Where an interest is automatically assumed, we can describe this as having arisen at common law.

At contract law, sometimes a person will agree to accept responsibility for something for they would not ordinarily be liable. For example, a landlord, rather than a tenant is normally liable for the maintenance of their property. The lease will often contain a condition that makes the tenant responsible for the maintenance or repair of the building. This gives the tenant a financial (insurable) interest in the property.

The tenant, has insured the property on this basis at a value of €240,000 for buildings and the landlord had instructed them to do so however the lease did not stipulate this.

After several letters of correspondent’s insurers loss adjusters finally accepted that the tenant had a legitimate interest within the property and agreed pay damages upwards of €100,000.

There was also an issue with the business interruption claim whereby they applied a Carte Blanche approach and tried to devalue the claim by over 50%, again it was proven that the basis of what they were trying to state was unjust enrichment on their part and they finally accepted to uplift the amount by over €15,000.

In essence, we uplifted the offer by over €115,000 through technical knowledge of commercial insurance claims therefore was appointing an independent loss assessor really at their own cost?