One of the largest privately held packaging companies in the United States, Pacific Southwest Container provides some of the world’s biggest brands with packaging making it critical to resolve the claim expeditiously. PSC management knew that its first priority was to its employees and its customers; while at the same time, it was critical to focus on running the business. Hiring Adjusters International allowed them to maintain this priority, rather than trying to navigate the logistics of filing and negotiating a complex property insurance claim on such a large loss.
- Instead of replacing the damaged printing press with new equipment, their insurance company opted to locate a used replacement press and offered it as compensation under PSC’s insurance policy. Replacing the equipment with a used machine would save the insurance company millions of dollars.
- In order to resume operations and meet their manufacturing deadlines, PSC moved forward independently and purchased a new press at considerable expense. The insurance company positioned that because PSC bought the press on their own terms, they would not reimburse PSC for the new machinery.
- When did the period of business interruption indemnity end?
- Adjusters International took the position that PSC was entitled to new equipment under the terms of its insurance policy. The used equipment provided by the insurance company would not come with the same warranties and guarantees as the equipment they had at the time of loss. Anything less would not qualify as indemnification.
- As a result of the insurance company’s delays in replacing the printing press, PSC took the initiative to purchase a new press at their own expense— based on their commitment to put their employees and customers first. The insurance company argued that it wasn’t their obligation to reimburse PSC, as the company had chosen to purchase the equipment on its own. Adjusters International and PSC argued that had they waited any longer, inaction would have compromised the stability of the company. Based on these arguments, the insurance company relented and agreed to reimburse PSC for the new printing press.
- The insurance company’s lack of action unnecessarily extended the period of restoration, creating preventable costs and losses. The carrier conceded additional compensation for added expenses and lost income caused by the insurance company’s delay in paying the claim was calculated.
- The insurance company argued that the period of restoration ended the day the replacement machine was turned on. Adjusters International countered that the period of restoration ended several weeks later — after the replacement machine was calibrated and was operating as it did immediately before the loss. The carrier ultimately conceded.
The Adjusters International team succeeded in securing reimbursement for a new lithographic printing press that allowed Pacific Southwest Container to continue operations. With the forensic analysis provided by Adjusters International, the insurance company also agreed to compensate PSC for lost revenue and additional expenses caused by its delay in settling the claim. The efforts of Adjusters International resulted in a final payout that more than doubled the size of the insurance company’s initial offer.