There is nothing worse than your insurance company or their adjuster informing you that the damage to your property Is Not Covered! Such was the case when this flood insurance adjuster denied a major portion of this claim referring to his interpretation of the coverage on page 5 paragraph 3 sub paragraph f. of the Standard Flood Insurance Policy General Property Form.
The issue at hand had to do with a grocery store which sustained significant flood damage during Sandy. Public Adjuster Rick Tutwiler of Loss Consultant Tutwiler & Associates was called in to help. Specifically, the flood adjuster assigned to handle the claim was of the opinion that the commercial refrigeration equipment should be covered under Personal Property. In addition, his interpretation of the policy and subsequent application of coverage was simply wrong due to the fact that the refrigeration equipment is directly connected to the building since they are bolted to the floors and in some instances also connected to the walls. This is notwithstanding the fact that the refrigeration equipment is also hardwired into the building's electrical system and connected to the compressors which were enclosed outside. So why did he make such a huge mistake?
After a very careful review of the Standard Flood Insurance Policy General Property Form (Page 5 Paragraph 3) which the adjuster was basing his coverage determination on, it was clear that he was incorrect. This decision would have forced the insured to close his business, ultimately impacting his sole source of income for his family and his ability to serve and support the local community as he has done for many years.
Given all the facts and Mr. Tutwiler’s understanding of the policy language, he referred the insurance adjuster and his superiors to page 3 of the Standard Flood Insurance Policy General Property Form where it specifically lists the items covered under the building:
Paragraph 4. The following fixtures, machinery, and equipment which are covered under Coverage A only:
H. Walk-in Freezers
P. Units within the building, when installed:
While the insurance company adjuster was correct in adding the Walk-in Freezers in the building claim, he was incorrect in his position that the refrigeration equipment was to be covered as Personal Property. Mr. Tutwiler also provided documentation that the commercial refrigeration equipment was clearly installed and connected to the building, and should be covered under the building portion of the insurance claim, not personal property.
This claim was taken all the way up the chain of command and after diplomatic perseverance, the insurance company reversed their decision and covered all commercial refrigeration units under the building portion of the claim.
As a result, the owner was rightfully paid, ordered new equipment and was looking forward to opening for business just in time for the season.