Redefining Denied Baltimore Business Interruption Claims
Every insurance policy ever issued in Baltimore is a unique contract that defines the obligations of both the insured and the insurer. At its core, an insurance policy represents a fundamental agreement: the insured pays premiums in exchange for financial protection if a specified risk or peril occurs. This is the basis of “coverage.” However, as Attorney Eric T. Kirk can attest, the reality of insurance claims is often more complicated. Insurance companies routinely deny claims, arguing that losses are not covered under the policy’s specific terms.
The Role of Policy Review in Baltimore Business Interruption Claims
A successful business interruption or loss of business income claim starts with a comprehensive policy review. Every policy is different, but many insurers use standardized templates that provide insight into how claims are handled.
Insurance Services Office Inc. (ISO) is an organization that collects statistical data, promulgates rating information, develops standard policy forms, and files information with state regulators on behalf of insurance companies that purchase its services.
Among the most widely used ISO commercial property coverage forms are:
- CP 00 10: Building and Personal Property Coverage Form
- CP 00 30: Business Income and Extra Expense Coverage Form
Understanding how these forms operate and interact is essential in determining whether a business interruption claim is valid under a given policy.
Coverage Types: Named Perils vs. Special Causes of Loss
Policies generally fall into two categories: named perils coverage and special (or all-risk) coverage.
Named Perils Coverage
Named perils policies specify the risks they cover. If the cause of a business interruption is not explicitly listed, it is not covered. The two most common named perils forms are:
- Basic Causes of Loss Form (CP 10 10): Covers specific perils, including fire, lightning, windstorm, explosion, vandalism, and sprinkler leakage.
- Broad Causes of Loss Form (CP 10 20): Includes all perils in the basic form and adds risks such as falling objects, weight of snow or ice, and certain water damage events.
Special Causes of Loss (All-Risk) Coverage
Unlike named perils coverage, special causes of loss policies provide broader protection. They cover all losses unless specifically excluded. The CP 10 30 Special Causes of Loss Form is widely used for this purpose. While this type of policy offers broader protection, insurers often argue that exclusions prevent coverage for certain business interruptions.
The Reality of Baltimore Insurance Claim Denials
In theory, an insurance company should provide compensation when a covered loss occurs. In practice, many claims are met with resistance. Insurers frequently cite exclusions, limitations, and policy language to deny or minimize claims. Some of the most common reasons insurers deny business interruption claims include:
- No Direct Physical Loss or Damage: Many policies require tangible damage to property to trigger coverage. Insurers argue that loss of business income alone does not constitute “direct physical damage.”
- Policy Exclusions: Even in policies that provide broad coverage, specific exclusions may apply. Insurance companies often reference exclusions related to contamination, government actions, or wear and tear.
- Failure to Meet Policy Conditions: Insurers may deny claims if the business owner did not file a timely claim, failed to provide adequate documentation, or did not take reasonable steps to mitigate damages.
Fighting a Denied Business Interruption Claim
A denied claim does not mean the end of this road. If your insurance company has rejected your business interruption claim, legal recourse may be available. Insurance companies employ highly skilled attorneys to defend their interests, making it crucial for policyholders to have experienced legal representation as well. Attorney Eric T. Kirk has spent decades litigating insurance disputes, challenging wrongful claim denials, and securing compensation for policyholders. He has firsthand experience with the tactics insurers use to delay or deny claims and understands how to counter these strategies effectively.
Steps to Take After a Denied Business Interruption Claim
If your claim has been denied, consider the following steps:
- Review Your Policy in Detail: Understanding your coverage, exclusions, and limitations is the first step in determining whether a denial was improper.
- Document Everything: Keep records of all communications with your insurer, financial statements, business interruption expenses, and evidence of your losses.
- Consult with an Experienced Attorney: An insurance dispute attorney can evaluate your case, interpret policy language, and determine whether legal action is necessary.
If your insurance company has denied your business interruption claim, you do not have to accept their decision without review and potentially challenge. Attorney Eric T. Kirk is prepared to fight for your rights, ensuring that insurers uphold their contractual obligations.