Adequate insurance coverage can be a lifeline for New York companies when unexpected issues occur, such as a fire, storm damage, flooding, vandalism or injuries to customers that lead to claims for damages.
Insurance companies are legally bound to operate in good faith when considering claims. However, most insurers put their own bottom lines first by devaluing, denying or delaying claims to pay as little as possible.
Top 10 commercial insurance claims
A recent study by The Hartford concludes 40% of all businesses will likely suffer a property or liability loss within the next 10 years. After analyzing claims over five years, the financial services giant ranked the most frequent types of claims:
- Burglary and theft – 20%
- Water and freezing damage – 15%
- Wind and hail damage – 15%
- Fire – 10%
- Customer slip-and-falls – 10%
Rounding out the top 10 are customer injury and damage, product liability, struck by object, reputational harm and motor vehicle accidents.
Insurer tactics to avoid paying claims
Insurance policies are contracts, and insurers can be held accountable when they don’t fulfill promises to policyholders. Examples of so-called “bad faith insurance” are:
- Failing to investigate claims
- Refusing prompt payment of undisputed claims
- Unreasonably denying claims
- Lowball settlement offers
- Failing to defend policyholders
- Delays over processing claims
Experienced commercial business lawyers can help resolve these disputes through litigation or negotiation. New York laws allow you to recover actual losses caused by illegal insurer tactics, but the state rarely allows punitive damages.
Guard against other types of potential disputes
Remember that an ounce of prevention is worth a pound of cure. Having experienced legal advice is not only vital in responding to bad faith practices but helping avoid potential losses and interruptions by reviewing policies, assessing adequate types of coverages and amounts and providing risk management guidance.