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This is not "untypical" of large commercial losses. I would venture that all of the policies written for utility companies are singular policies, not off the shelf policies. You will have to wade through the coverages, exclusions, endorsements, and all of the provisions.

I would humbly suggest that after all this and you have some idea of the scope and cost of the loss, that you write a preliminary report to your supervisor with your thoughts of coverages or lack thereof, referring to the page number of the endorsement or policy.

This loss is going to take a lot of time and research on your part but it's gonna be worth it as it will have to be a T&E billing.

Happy Trails

Mr. Hardin thank you for the assistance,

I have already written the preliminary with my thoughts and questions. I politely offered to review the policy and to make a recommendation as to coverage should the inside adjuster feel necessary. While discussing the claim with the IA he advised that I should present a recommendation as to my opinion on coverage. He advised that he would email the policy directly. Shortly thereafter he informed me that I would need to pick up the policy as there was no way to email the file. I must concede, I am embarrassed to admit that I was excited that I have the opportunity to read the policy. (My wife rolled her eyes and said "hurray") when I told her how cool this was going to be. Engineers, policy interpretation....ahhhh life is good.

Yes it is T&E. To me it doesn' matter. I am going to adjust the claim one way, the right way. Focus on the proper way to do the task and the money will fall in place.

Chad W. Rundell

Again Thank You

You may want to write a "Coverage" caption in your report. It might have some sentences like this:

Coverage is afforded to the insured under the xyz1020 form. This form covers "direct damage by wind". .... Endorsement abc1027 excludes damage "cause by electrical outage or surge".

I would go through the policy and make notes on every single policy provision that may be applicable. For example, if there is an exclusion for something that might have happened (like an electrical surge) then mention that exclusion. If there is an exclusion for inherent defect in the insured's device, and that could possible be going on, then mention that.

For this size of loss and a custom form, you could have a 3 or 4 paragraph "Coverage" caption mentioning all the basic points of coverage tat could be relevant.

When you synopsis that it will help the file examiner understand the coverage but more importantly it will help you.

It is vital to understand the coverage because it will give you ideas on what to investigate besides what you already thought of.

When you say these instrument were damaged by wind, how exactly?

Where they torn off the utility pole and slammed to the ground? Damaged by electrical surge? Soaked by rainwater?

Devices that are designed to be left outside should be fairly weather resistant. Are they just misaligned and no longer pointing at the satellite?

Are they truly damaged? Maybe they are not functioning because the cable connection is broken, but the instruments themselves are not broken.

Perhaps you should remove a sample group of instruments, labeling each with a number and sending them to be tested.

How old are the instruments? Is it a model that is becoming obsolete and being replaced anyway? (hint: depreciation).

Can they be rebuilt or reconditioned? Can you call the manufacturer of the instrument and find out more info? Your report should always include a "Salvage" caption. Even if the units are totally trashed beyond repair, you still should have a salvage caption to say so.

I might ask what the insured's labor rate is to install the item and how long their own employees take to do it. Also they should give you access to their purchasing records so you can see what they paid for the instruments.

I would ask if the insured truly owns the item or is leasing it from some other party. Also possible that the end user is leasing it from the insured or may already own it outright, and it is no longer property of the insured.

I have no idea how that business works, I would just want to know. For example the cable between poles might belong to the insured, but the cable that drops to the end user's building might belong to the end user and is not covered by the insured's policy.

Is there any subrogation potential against the installer for improperly installing the instrument? Is there an installation manual (from the manufacturer?). Is there a wind rating for the instrument? Should it have not gotten damaged based on the wind speed? (Your report also needs a Subro caption)

Is there coverage for loss of income when the insured's customers don't pay because the system is down? If so, what is the potential exposure? If the loss is $20,000 per day, the investigation needs to go quickly.

Maybe you haven't been asked to look at liability. But if the same carrier that assigned you the property claim also covers liability, you may want to take a minute and look at liability exposure and maybe ask for guidance. For example, if the system went down partly due to faulty installation, there could be some large claims against the insured by customers who lost business.

I have seen numerous fires where utilities have been sued because the wiring (or the transformer) was known to be a problem before the fire and the utility did nothing to fix it. (Subro again)

Did trees fall and tear the wires? Was somebody (perhaps the insured?) supposed to have those trees trimmed on a regular basis and neglected to do it? (Subro again)

My suggestion would be to look at different angles so you don't leave any big issues unaddressed.

Coverage...Causation....Cost....Salvage...Subro....Business Income..... Liability....

I am still trying to sort out the true cause of loss. The instruments are all inside. They are the banks of receivers. As I understand it each channel one must have a separate receiver, then another transformer that relays the signal to the customer. There were several tornados in the area on the reported date of loss. The insured reports that high winds caused the power lines to collide causing power surge. I have contacted an engineer to evaluate the items that have been reported to be damaged/destroyed. (with the carriers blessing)

There are so many locations because (this is ironic) The signal for the cable is received via satellite. That is one location. Tthat signal is sent to the main office location, from there it is distributed it to substations in various places in the town, then on to the customer

I am investigating what types of surge protection was in place, and why it failed. Possible subro I think.

Loss of income does not seem to be an issue the insured is proactive, they have repaired/replaced all damage and are functioning at 100%. They know to save everything that was damaged.

The issue of ownership is a great point. I noted that the receivers had the name of the channel on it, some with tape some were engraved.

Tree maintenance is another great point.

Your input incredibly valuable. I had some ideas on what direction to go in and what to look for. I certainly did not have all of your points on my list.



Thank you so much.

Chad,

This is fascinating. Please keep us posted with the developments.

Leland,

Best forum reply I've read in a very long time.

I will Lee, I finally got a copy of the policy, all 378 pages. I have an engineer lined up to start evalution of the instruments that are reported damaged.

I am throught the policy and have it narrowed to about 9 pages that apply to this loss. There are expanded coverages... and limits to coverage that have it narrowed down. I need a day to sleep on it and revisit. At that point I think I am ready to have an opinion as to coverage.