Leslie Thorne Guest Column in Law360: Insurance Coverage For Storm Devastation
As storms rip through the southern and midwest U.S., businesses nationwide struggle to determine their losses. The May 22 storm that hit Joplin, Mo., left much of the city leveled. In Tuscaloosa, Ala., alone, where a tornado hit on April 27, the American Red Cross estimates that at least 5,000 properties have been destroyed.
Catastrophe modeler Air Worldwide Corp. has estimated insured losses resulting from recent storms and tornadoes at up to $5.5 billion already. Moreover, the catastrophic destruction we see in these communities is only part of the picture. The financial aftershocks will be felt throughout the country.
In handling the crisis, companies must quickly evaluate their available insurance coverage.
Any delay in identifying coverage and making claims only compounds the problems and can even foreclose coverage altogether. Failure to pursue available insurance can even result in liability to shareholders and others.
To protect itself, each company affected first must understand what coverage it holds by reviewing its policies and determining which ones could provide coverage for the current catastrophes. In doing so, companies also should consider what additional coverages may be purchased to protect against future disasters.
This article is excerpted from a Law360.com guest column. To read the full text, please click here (subscription required).