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Last Post 02/27/2011 5:23 PM by  Adjuster.Pete
BI Information
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Tom Toll
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12/05/2006 1:34 PM
    Liberty Mutual has basic information on Business Interruption. Their website is below. This should give you a good idea on the complexity of accounting and how to figure BI and Extra Expense coverage.

    http://property.libertymutual.com/M...index.html
    Success is not final, failure is not fatal: it is the courage to continue that counts.
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    ChuckDeaton
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    12/05/2006 2:33 PM
    Let me point out that Business Income coverage is a part of the Time Element package. There could be Extra Expense coverage, Business Income from Dependent Properties w/Extended Period of Indemnity Newly Acquired Properties, Civil Authority, Deferred payments and Off-Premises Power or Water Failure.

    Always check coverage and policy wording before heading out to hike in this forest.
    "Prattling on and on about being an ass with experience doesn't make someone experienced. It just makes you an ass." Rod Buvens, Pilot grunt
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    Dimechimes
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    12/05/2006 4:43 PM

    Here is the original post on that BI info since it includes the Insurance Journal press release that might be of interest.

    http://www.catadjuster.org/forum/tm.asp?m=15308

    Also- here is a link to an outstanding BI checklist which is very thorough that could be helpful: http://www.abanet.org  article.

    Here is also a link to an excellent National Underwriter book on BI that came highly recommended from a member of our site:

    http://www.nationalunderwriter.com/...p;mscssid=

    Hope this helps for those needing additional BI reference material.

    (edit fixed links)

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    host
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    12/05/2006 4:45 PM

    Click here for a BI quiz, created by Clayton.   I also did a search in the archives and found 73 topics on BI claims this includes bulletins and forum posts.

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    Tom Toll
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    12/05/2006 11:38 PM
    As Chuck pointed out, BI entails many aspects to understand. A policy review is always necessary prior to determining coverage for a particular loss. The forest is thick, so one must be prepared to enter the woods with as much information as possible. All the links provided will give you an understanding of what BI (time element) consists of. It is best to have a good accounting background.

    Thank all of you for chiming in on this. The additional links are appreciated. During the 4 in 04, I handled 31 BI's to conclusion, with the assistance of an accounting organization in Tampa. When your busy doing residential and commercial losses, there is little time to devote to properly handling time element losses. Know what your capable of and don't bite off more than you can chew.

    Remember that this is what CADO is truly about. Information sharing so all can gain knowledge of proper adjusting techniques, principles, and coverage analysis. If anyone can share here, it would be appeciated and certainly welcome.
    Success is not final, failure is not fatal: it is the courage to continue that counts.
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    HuskerCat
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    12/06/2006 1:57 AM
    This is very good information for all, but before you put it use...make sure it has been made a part of your assignment.  Many times, the BI exposure will be handled in-house.   So, make sure you know before you step into the mix.   Don't waste your time, if the carrier is already handling the BI exposure.  But...it doesn't hurt to make mention in your report if you see any adverse affects to BI that are not related to the "cause of loss".      
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    ChuckDeaton
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    12/13/2006 6:13 PM
    Calling a Time Element loss a BI (Business Income) loss will limit your thinking. As is noted above there are several coverages involved in Time Element, Business Income is only one. There are several variations on the policy wording for each coverage element.
    "Prattling on and on about being an ass with experience doesn't make someone experienced. It just makes you an ass." Rod Buvens, Pilot grunt
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    dcmarlin
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    03/24/2008 11:22 PM
    As ya'll may know, there is an outbreak of salmonella in the water system in Alamosa, Colorado, a town of about 10,000 in the southern part of state.

    My wife works for the state (Office of Emergency Management) and was questioned by the governer's office if there is insurance coverage for B.I. losses. If no insurance coverage, the SBA and other agencies get involved. My wife, of course, asked me. My BI knowledge is limited.

    Hotels are restaurants are losing $$$$$ due to the lack of clean drinking and cooking water. There is no physical loss or damage and no civil authority closing businesses. The cause is unknown but the contamination is not believed to be due to vandalism or some other reason which can possibly be a covered cause of loss.

    Unless one has a manuscript policy which may apply, I do not believe the CP 0030 (or similar) with a CP 1030 (or similar) will cover. Correct?
    Gimme a bottle of anything and a glazed donut ... to go! (DLR)
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    sbeau4014
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    03/25/2008 10:37 AM
    Most of your loss of earnings coverages will tie any coverage to physical loss to the risk location that caused the business to be shut down. There are some manuscripts that may pick up a LOE claim for this situation, and you may find that some of the national chain type restaurants and hotels may have a coverage form that might pick it up also. My gut feeling would be that it will be pretty rare that a business will have coverage for something of this nature, and I've never worked a claim like it before. I have been in areas where they had some diseases that were not limited to one location and never seen a claim make it to my desk.
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    Tom Toll
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    03/25/2008 10:40 AM

    In my opinion, there is no element of damage, therefore no hope for compensation under BI coverage. Unless this is a manuscript with that element of cause implanted in the policy, then and only then could consideration be made. I could find no provision for tainted water.

    Success is not final, failure is not fatal: it is the courage to continue that counts.
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    dcmarlin
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    03/25/2008 4:56 PM

    Steve & Tom,

    I was pretty sure most would not cover.  I believe the governor declared a catastrophe so funds may be available through other means.  My wife is actually heading down tomorrow.  Thanks for the info.

    Gimme a bottle of anything and a glazed donut ... to go! (DLR)
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    Ray Hall
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    03/26/2008 1:13 AM

    I would be very surprised if any business in this small city had a manuscript type BI coverage called contingency BI. I had a claim years ago in Colorado when an Oil & Gas Operator had to shut his gas wells in as the gathering plant that collect their gas and other O & G operators in the ENE section of Colorado that had production could not send their gas to market via the pipeline as the plant had to close down due to an explosion that disabled the plant when a contract welders torch blew up some large vessel.

    The plant took wet and dry sweet and sour gas as well as oil and had meters to tell each producer how much product they were sending in by the btu value. After the plant got back on line we just took a 60 day run prior to the shut down multiplied by the number of days the wells were shut in and took a proof of loss and joined in the suit against the small welder who only had a 2 million single limit policy with cost of defense inside the limit. The same leading underwriter I was working for was also the leader for the welders CGL, but a conflict of interest existed. But three operators was feeding this plant and we also got one other operators claim. As I recall the BI claims and the physical damage to the plant was about 4 million. Seems like our policy had a 72 hour waiting clause, and $100,000. deductible and a 6 month indemnity limit or $25 million limit.

    The total subrogation claim for both operators was about $770,000.00

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    Adjuster.Pete
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    02/27/2011 5:23 PM
    Tom

    Thanks for the Liberty Link.... Very helpfull and still works...
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