We’ve been celebrating some victories for clients this month with an end to some quite protracted negotiations with insurers and their agents on our client’s BI claims.
Louise Burns-Lunt our in-house chartered accountant has been handling the calculations of losses on behalf of clients and is aware of some of the techniques being used to try and restrict client claims.
The detail required to complete the claims has been quite extraordinary. Insurers are asking for detailed information that goes back earlier than the period immediately before the loss was suffered (as stated in the policies). This information has been used to prove trends (a small print in many policies that allows the insurers to flex the figures). For instance, a lower turnover figure for 2019 as opposed to 2018 is used to prove that the business was in decline…despite the fact that turnover for the period after was increasing again.
Calculations are extremely complicated, and the insurers have the advantage of having teams of forensic accountants and loss adjusters working on their side. Faced with a lengthy spreadsheet and complicated formulas it would take someone with experience to navigate their way through them and understand the calculations. Which it is not reasonable to expect that a lot of businesses would have the skillset to be able to do that. We are ideally placed in that regard to assist clients, and in fact on every single one of the files where the insurers have made an offer for losses, we have rejected the first offer to date for wrong assumptions or calculations being made. Businesses should be aware that they are not obligated to accept the insurer calculation and that they are able to negotiate and disagree with offers being made. Some of the differences in offers can be substantial. One of our clients had an increased offer of circa £40k where Louise disagreed with the method of calculation. £40k to a business that has already been affected by COVID is huge, and it surely isn’t right that clients are having to argue with insurers to obtain the financial re dress that their policy should be covering them for.
In addition, many are being caught by the under-insurance rule. If you insured your business turnover for £300k, but turnover was more than that, then your claim is reduced by the percentage you were under insured for. This is an area that clients need to be alive to when arranging insurance for the coming periods.
Louise is acting for businesses who have an annual turnover in excess of millions, through to hairdressers, hotels, and shops. She has a wide range of experience in loss calculation and can offer initial advice to businesses struggling with a claim against their insurer.
How can you claim business interruption compensation?
At Smooth Commercial Law, our team of legal experts have extensive experience in dealing with a whole manner of commercial dispute claims. We are seeing more and more cases relating to business interruption insurance, and can help take the first steps to challenge your insurer. Whether it is against AXA, Hiscox, Aviva, Allianz, Beazley or any other insurer, we will fight your corner.
Our legal team comes from a financial services and compliance background. We are regulated and authorised by the Solicitors Regulation.
If you believe you are eligible for business interruption compensation, we can guide you on your next steps and can advise if we believe you have a claim going forward. Should you have a claim against your insurer, we can deal with your case and look to recover compensation.