Tuesday 4 June 2013

T&B appointed to multi-million pound fire

A printed circuit board manufacturer based in eastern England suffered a multi-million pound loss following a fire that destroyed its main production unit and caused extensive smoke and water damage to the remainder of the premises.

Major loss team
Thompson & Bryan’s major loss team were assigned to manage the claim and they spent several days on site with the policyholder and other interested parties in the immediate aftermath to discuss how business continuity might best be achieved and to also formulate a strategy for collating all the information required to support the insurance claim.

The company had suffered a major fire previously and encountered significant difficulties in resolving its claim and recovering the business so we were immediately under pressure to demonstrate our professionalism. We set about quantifying the claim.

Buildings
Working alongside a team of engineers and surveyors, we coordinated the demolition and clearance of the most damaged unit. We also coordinated the production of all the necessary specifications and other information to support the reinstatement works required to the remaining buildings on site.

Machinery and plant
Our main task was to produce an inventory of damaged and destroyed production machinery, computer equipment and general contents. We researched new for old replacement prices and produced a detailed and fully supported schedule of claim.

Stock and work in progress
Due to the extent and variety of stock, including raw materials and work in progress, in the premises at the time of the loss, we negotiated an agreement that the best way to quantify the loss was to carry out an accounting reconciliation based on the policyholder’s financial records.

The calculations were prepared in various ways to provide a ‘sense check’ on the values produced and this was then used as the basis for the stock claim submission.

Business interruption
Following our initial discussions with the policyholder regarding business continuity, it was agreed that subcontracting customer orders was the only viable means of maintaining short term order fulfilment. We maintained an electronic record of every customer order placed, its value, subcontract cost and BAU production cost to accurately calculate the value of claim that would be submitted under the ‘increased costs’ section of the policy.

We also analysed pre and post incident turnover to prepare calculations to support the loss of gross profit calculation using the policyholder’s financial information and in close liaison with their accountants. A detailed and comprehensive submission of data and analyses were submitted to insurers in support of all aspects of the business interruption loss including a projection of the anticipated impact for the full 12 month maximum indemnity period on the policy.

Outcome
We negotiated an early cash settlement, which provided the business owners with the flexibility to reinstate in a way that best suited them and in a time frame that best met their long term requirements.

Summary
The management of the company were extremely pleased with the way we applied our resources and expertise so that they didn’t have to be involved in the day-to-day direction and management of the claim. This enabled them to concentrate on their business and their clients.

What to do next?
If you think we can help you with a claim why not contact us today.

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