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Property & Casualty Insurance/Should I file a claim and against who?


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Hi! Jay, I was told you might be able to help...

I am hoping you could help me. On December 2012 we received a fire alarm that started in the basement next door; our office was greatly damaged by the fire which currently is still under reconstruction by the owner. For my luck I was not able to renew my insurance which was due for renewal at the end of October; with a termination date effective December the 4th. Perhaps; on December the 27th we were schedule to meet with the agent to open a new policy but the fire broke out early that morning leaving me without any recourse. According to the fire department it was electrical problem which started in a walk through freezer not in used in the office next door. When talk to the owner they stated that there was no way to locate the person who did the electrical if they were when the office updated years ago, and the electrical might of being grandfather in  so it should be a 100 years old which mean that they would not be responsible.
My company is a tax preparation and business service since June 2011. Last year was our full year perhaps my worse last year after the event that took place.  So as it stand I have no liability insurance and for what I was told my rental insurance for my apartment might not cover it because is two separate location, hence; the landlord is saying that his insurance would not cover personal property in this case my loses but will fix the place, yet all the fixtures, dividers and stuff would not be replace just the walls, I pretty much lost over 60,000.00 with equipment, marketing, inventory, furniture, and not to mention projected revenue of 70,000.00 for this season which is on a low end.
I know being approach by my landlord about the raising the rent, or leaving as he claim the lease is up, because his afraid that we would sue him for negligence. I personally; just want to know if the insurance should pay me for something.  I do not want to get into court but it seen to be the only way to recover my lost and have the funding to start back there or find somewhere else.
By the way I currently seen people from my apartment but my wife is not too happy about it plus I think is not safe as I constantly new referral people.
Please let me know what steps I should take or do to get something or is it a total lost on our side just need to rebuild.

But this is outside of my expertise.

Hello Mike,

From what I have read, I believe your intention was to ask your question to expert Jay Williams. Nonetheless, since the question arrived into my e-mail for, I will give you my opinion. Please feel free to share this opinion with whomever you feel appropriate:

First the facts of what I understood in your question (please feel free to correct me if I am wrong here!):  You are a tenant on a building that belongs to "X" landlord. You have a financial business office operation which is in a specific space located on said building and you are the tenant on said building.
Your direct improvements and betterments and/or personal property loss may amount to approximately $60K and loss of business income and/or extra expenses may amount to $70K approximately.
From what I read in your question, the cause of the loss had nothing to do with your operation as such. It so happens that "According to the fire department it was electrical problem which started in a walk through freezer not in used in the office next door."  So my guess is that we are clear that this was not your doing nor due to your negligence and that the freezer is not under your rental or lease agreement.

The fact that some contractor many years ago did work with the electricals of the building and specifically the walk through freezer is irrelevant and DOES NOT eliminate the fact that legally speaking, the landlord could be DIRECTLY LIABLE OR VICARIOUSLY LIABLE (indirectly liable) of the damages which actually were due to and occurred due to a "premises / building" exposure of the landlord.

CONCLUSION: You do in fact may have the legal right and option of going against the landlord and let us hope, for the landlord's sake, that he/she carries a Commercial General Liability (CGL) Policy.  You may file a claim against said landlord and in turn the landlord will submit the same to his/her insurance company. You will have the right to claim direct damages to your property as well as all indirect and consequential damages, such as loss of business and/or extra expenses you may have been incurring.
A claim may be filed without involving legal representation moreover if you are in good terms and relationship with your landlord and if landlord is willing to help out.  If this good relationship is nonexistent or existent, you have to make a decision: "Will I sue then?"...."If I sue, does that mean that I will most probably have to rescind the lease agreement and move into another location?". "Will this mean my relationship will deter with the landlord?"

Mike, you may contract the services of a legal representative whom in turn may be able to take your case into court and will fight for your rights under the Commercial General Liability policy of the landlord, but remember there could be legal costs associated with the suit, unless your legal representative goes on a contingent basis, which means that once the claim is settled he will get his cut of the claim (could be usually a 33%).

I would suggest you first talk to your landlord. Let him know that even though you both have a good relationship, business is business and this is a hard hit. If you would have had your insurance Mike, your insurance would have paid you but would have subrogated (go against) the wrongdoer's landlord liability policy.  So this means that in one way or another, the landlord's insurance would have to participate.

BOTTOM LINE HERE:  The landlord could be held liable as owner of the building you occupy, since damage derived from his /her premises exposure.  Keep in mind that you should also review the lease agreement you have with the landlord. It probably should state who is responsible for what.

I hope this initial opinion can give you a head start as what to consider and do.  Please let me know if I can be of further assistance.  I am glad I can be of service and surely hope you can positively manage this unfortunate event with a positive outcome.

Best of luck!!

Richard Dunnam

Property & Casualty Insurance

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Richard L. Dunnam, CIC, AAI, AMIM, AINS


Property and Casualty coverages and claims concerns. In either areas of personal or commercial insurance. In Spanish or English. Can provide solutions for concerns regarding coverage specific, services or general issues to the general public, claimants, insureds and for the insurance industry in whole, for the U.S. and/or Puerto Rico


English and Spanish fluent speaking professional with 28+ years of experience in following fields of insurance: commercial and personal lines underwriting, property and casualty claims adjuster, property and casualty insurance producer, insurance educational consultant approved by the Dept. of Insurance in Puerto Rico. Offer insurance continuing education and prep courses for insurance exams in Puerto Rico. Property and Casualty court expert witness for commercial and personal insurance. Real property insurance appraiser. Faculty member for the National Alliance for Insurance Education & Research, Certified Insurance Service Representative professional designation courses and Dynamics of Selling programs in Puerto Rico and the U.S.

Faculty for Professional Insurance Agents of Puerto Rico & the Caribbean Faculty for National Alliance for Insurance Education and Research Faculty for Sales Management Executives (Puerto Rico)

Impacto Seguro ("Insurance Impact") - Puerto Rico insurance publication Agent and Broker - monthly publication

Pursued the following: BBA Business Management - IAU - San Juan, PR Associate in Marine Insurance Associate in General Insurance Accredited Insurance Advisor (AAI) Certified Insurance Counselor (CIC) Marshall & Swift Trained Appraiser Chartered Property and Casualty Underwriter (currently 9 of 10 approved)

Past/Present Clients
Antilles Insurance Co. Universal Insurance Co. CNA Casualty Puero Rico (Integrand Assurance Co.) Colonial Insurance Agency Multitransport Co. AVIS Rental (PR) Puerto Rico Government dependencies and municipalities

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