News & Insights

Case study: settlement offered well below cost of rebuild

Published 01 November 2021

When a prestigious property in a commercial wine-growing region burns to the ground, having insurance cover is a bulwark against a devastating loss – so when the proposed payout won’t cover the cost of a rebuild the case clearly requires review.
 

Claim background

A micro fissure in the mortar of a fireplace was the fatal flaw that caused this property to catch fire in the middle of the night, and it burned to the ground. The owner naturally set a property claim in motion and a quantity surveyor was appointed to calculate the cost of rebuilding as soon as possible.

But the figure proposed was well below the owner’s expectations and their claim for payment for alternative living expenses was turned down due to their owning other properties where they could potentially stay as an alternative to their destroyed home.
 

 

Resolution

Together the property owner and the Gallagher claims advocate revisited the premise for the claim. After conferring with the rebuild architect they reformulated the claim submission, including a line by line analysis document to present to the insurer for consideration. 

The Gallagher claims handler accompanied the property owner to meet the with the insurer’s representatives and attended subsequent discussions to provide support where needed.  

Following a series of strong negotiations the client received a revised offer from the insurer which exceeded the original offer by more than $1 Million and included payment of alternative living arrangements expenses. 
 

The Gallagher difference

This case illustrates that the way that facts are presented can be critical to a claim outcome. 

Being willing to revisit a case and negotiate the settlement can be well worth the time invested – and having the support of a Gallagher claims advocate can help achieve a positive resolution.
 

We pride ourselves on our claims service

Part of our commitment to building business confidence is fighting for what’s right, and supporting clients through claims is one of our key pillars of business practice.

Gallagher claims expertise and 17 case studies are outlined in the Gallagher Advocacy in Action report where you can read more about this oil production claim in detail and other examples from professional indemnity to corporate travel. 

Download the report Claims Advocacy in Action: 17 Real Life Case Studies now. 
 

Further reading

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Gallagher provides insurance, risk management and benefits consulting services for clients in response to both known and unknown risk exposures. When providing analysis and recommendations regarding potential insurance coverage, potential claims and/or operational strategy in response to national emergencies (including health crises), we do so from an insurance and/or risk management perspective.
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