Wednesday, September 20, 2006

Katrina and Business Interruption Insurance Claims

Times-Picayune: Business interruption insurance claims could account for half of the commercial losses from Katrina, but many owners are still struggling to get payments. Excerpt:
"It's because restoring the destroyed property is going to take so long," Finley Harckham, a New York attorney whose firm, Anderson Kill & Olick, is working on both Sept. 11 and Katrina business interruption claims. "The BI claims are shaping up as the most contentious issue for businesses" after Katrina.

The terrorist attacks refined and developed a body of law surrounding the duration of business interruption claims after the many small service businesses and retailers located at the towers argued that the unique sales environment of the bustling transportation and commercial center could not be duplicated elsewhere, and that payments should continue until the World Trade Center was rebuilt. Some suits still are being litigated.

Similarly, in New Orleans, many of the disputes will tackle the question of when a temporary location becomes the new permanent location, and when an insurer's responsibility should end. In many cases, the length of time that businesses are away from their original premises may be related to difficulty repairing the property because of slow payment or disputes with their insurer over property claims. "This is shaping up as a big battleground," Harckham said.

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