Mayhem at McDonald’s
A sports car careened down the road out of control, hit a curb and flipped up into the air. It landed right in the lobby of a McDonald’s restaurant!
Thank goodness no one was hurt! The front dining area, however, was a mess. After the dust cleared, the engineers estimated it would be about a month to get everything back in working order. Till then, the restaurant was shut down.
The McDonald’s franchise owner was beside himself. Who was going to pay for the repairs? And a month without income? How was he supposed to pay his workers, the mortgage, the insurance and all the other expenses?
The sports car driver fortunately had plenty of insurance with State Farm. This insurance company accepted liability and agreed to pay for the building’s repairs.
While the restaurant owner was happy to have the property damages covered, he wondered about the lost income of the business while it was down. Would he just be out a month of income while still having to pay all his expenses? The adjuster put him at ease, explaining this lost income was covered under the driver’s liability policy as well. The adjuster called it “downtime” or “business interruption coverage”.
After a month, the restaurant was as good as new and State Farm paid the repair bill. State Farm also paid the lost income to the restaurant owner. The business was made whole.
Are Trucking Claims Different?
This claim between McDonald’s and State Farm involved an insurance claim with a typical brick and mortar business. In addition to the repair claim, the restaurant made a downtime claim against the party who damaged their business and was reimbursed for all his losses. In a perfect world, this is how it should always work.
Trucking claims are really no different. While a big rig may look a lot different than a McDonald’s restaurant, it should be treated similarly when it comes to insurance claims. A truck is also a business, just on wheels. When hit, a rolling business is also out of business until repaired.
State laws differ across the country. However, generally trucks have just as much right to downtime recoveries as stationary businesses do. Unfortunately, most insurance companies don’t understand this concept. Adjusters at insurance companies often equate trucks to cars rather than stationary businesses.
Many insurance adjusters think a semi-truck can be replaced as easily as a car, and may even suggest a claimant trucker rent something, no matter how impossible that might be. But trucks and trailers are often highly specialized and cannot be rented easily. In today’s tight market, it’s even more difficult to find equipment. Further, many motor carriers do not allow their drivers to rent temporary equipment according to their contracts or insurance policies.
The Claims Process:
Whether you have a fleet or only one truck, persuading an adjuster to pay a downtime claim can be hard. Unfortunately, educating adverse insurance companies on the realities of trucking often becomes part of a claim. Many adjusters are not familiar with heavy equipment which can create unnecessary delays.
The claims process is not easy. It’s a lot of paperwork and takes an abundance of patience. Truckers, remember that the adverse adjuster is not on your side. They represent the other party, not you. Relying on their information and advice is not always the best idea. It’s possible to innocently say things to the other side which sabotage a claim. Emotions run hot when equipment is down and losses are piling up.
So, how do you proceed with a claim? First of all, know your strengths and weaknesses. If you aren’t skilled in claims, get someone on your side who is. Consider consulting your insurance agent, accountant and attorney. With the right team behind you, even the most difficult claim can be managed.