Supermarket: Business Insurance
Background
Our client’s store suffered several power cuts and power surges in quick succession. The power cuts and surges were caused by the electricity company doing cabling works locally. A claim was made for spoilage of frozen and chilled food, business interruption, disposal costs and damage to compressors.
Problem
The insurer initially only agreed to pay for the frozen food (which was specifically insured under a frozen food extension) and the compressors. They attempted to exclude the rest of the claim hiding behind various policy technicalities.
What we did
We decided to counter the insurers’ arguments by being equally technical. We pointed out to the insurer that this was an “All Risks” wording which covered any accidental cause not specifically excluded. We then pointed out that power cuts and power surges were not excluded.
Our technical experts argued that the proximate cause of the loss was the power cuts/ and power surge (quoting relevant cases such as Pawsey v Scottish Union 1908), not the change in temperature. It followed therefore that there was a valid claim under the material damage section for the chilled food, compressors and disposal, and that the Business Interruption section of the cover was also therefore triggered.
Outcome
After lengthy discussions with the Centor team, the insurer accepted our arguments and agreed to pay the claim in full and apologised to the client. The claim was concluded for £7,586.63.