Hurricane season began June 1st, and runs through November 30th. However, we are about 30 days from approaching the peak of hurricane season, when the season becomes its most active. Weather predictors are predicting an above-average number of storms this year, with 14 expected named storms. As anyone who has worked “CAT” claims knows, when a hurricane hits, it’s “all hands on deck.” This is true for subrogation professionals, as well. There is a significant increase in the number of claims that must be triaged, with a goal of finding any claims that might have subrogation potential.
When analyzing subrogation potential following a hurricane, there are few key items you will want to have at your fingertips. The first is access to a wind speed chart. If you determine that the wind speed at the subject location was less than that set forth by the applicable building code, you will then want to have handy the applicable Statute of Repose to confirm whether or not the work that may have led to the subject damage (such as a roof failure) is within the applicable Statute of Repose.
Should you determine that the wind speed was under that set forth by the applicable building code, and the possible defective work was within the Statute of Repose, you will then want to consider engaging an expert to identify the specific cause of the failure. For this final key item, it will be important to have handy a list of experts in the area where the storm hit. Getting someone to the loss site ASAP, once you have determined that there may be subrogation potential, will be critical.
Following a storm, one of the most valuable sources of information regarding the insured property will be the insured. You will want to make sure that the adjuster knows that obtaining all information relating to the history of the property will be critical. For example, if the loss involves a roof failure, knowing that a new roof was put on the building two years prior to the storm will be critical. Further, some states have “right to repair” statutes. If the storm hit in one of these states, it will be critical to immediately place the contractor on notice of the potential claim and offer them the opportunity to inspect before the expiration of the time period set forth in the “right to repair” statute.
Another valuable avenue for information will be the local building department. Many building departments have on-line searches available, so you may be able to identify possible work on the property by searching the building department’s file on the subject property. The building department can also provide the age of building, drawings, specifications, permits and inspection history, as well as the name of the architect, engineer and contractor. The applicable building codes can also often be identified through the building department.
The investigation of a subrogation case arising from a hurricane loss is not much different than the pursuit of any construction-related subrogation case. It is just a bit more hectic as you typically aren’t trying to investigate such a large volume of losses at one time. The key is to be prepared in advance of the storm, and have the above information at the ready once the storm passes. This will help you quickly weed out the claims that have no recovery potential so that you focus on the claims that might provide any avenue for recovery.