This document discusses responding to large loss claims from an insurance perspective. It provides two claim examples: 1) A marina fire where a vessel fire spread and caused over $5 million in damage. The insured caused the fire and additional losses. 2) A fuel farm fire caused by a pump line explosion that resulted in $6 million in property damage and $20 million in business interruption claims. For both examples, it provides steps insurers should take in responding such as inspecting the damage, identifying responsible parties, attending joint inspections, and reporting findings.

1. RESPONDING TO LARGE LOSS
CLAIMS
A claims, expert, and counsel
perspective

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Claim Example #1
The Marina Fire

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Vessel Fire Spreads to Multiple Yachts at Miami Beach Marina

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• Over $5 million in total damage
• 5 yachts burned- 3 were constructive
total loss
• PD to the marina
• Personal injury to occupants

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Claim Example #1
• You receive notice from your insured
immediately following loss
• Your insured is the primary cause of the loss &
causes additional loss to third parties
• Your team controls the majority of the scene
& leads all inspections
• Potential liability & potential recovery

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• Perform preliminary non-destructive inspection:
• Conduct interviews. What was damaged? What work was performed by my
insured prior to the reported incidents
• Preserve the evidence:
• (e.g. Wrapping, transporting, & storing)
• Identify and place all parties involved on notice:
• Propose/Confirm inspection of evidence dates to all parties involved.
• Establish protocol for joint inspection:
• Include date, start/end time, location, number of days and agreed upon rules.
• Confirm protocol with all parties.
• Confirm Laboratory work (X-rays, SEM, ultrasound)
• Conduct inspection and reiterate ground rules.
• Maintain inspection’s pace unless there are objections. Secure evidence after
inspection until further notice. Report observations to client.

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Claim Example #2
The Fuel Farm Fire

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Sudden Pump Line Explosion Causes Massive Jet Fuel Fire

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• $6 million in PD
• 70,000 lost Grade A Jet Fuel
• 162 cancelled flights
• Over $20 million in business
interruption claimed

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Claim Example #2
• You receive notice from another party after
passage of some time
• Your insured likely “nominal party”
• Not immediate cause of loss, but may have
collateral contribution
• Your team does not control the scene

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• Find out what was damaged and what work was performed
by my insured prior to the reported incident
• Review the protocol that was sent out and address any issues
I may have with the wording
• Confirm my attendance and attend the joint inspection of
evidence. Gather as much information as possible
• Determine who the other parties are and try to obtain
information from them
• Request a list of the items that were collected as evidence
• Request that part of the evidence be retained/secured if it
will help in my investigation.
• Be careful not to reveal your findings to the other parties
• Report observations to the client or write a report

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Crane Collapse at Port of Jacksonville

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