When unprecedented catastrophe mars insurers’ ability to respond

On Behalf of | Dec 28, 2018 | Property Insurance Issues

Legions of insurance companies operating in Louisiana and nationally have unblemished records of optimal customer performance. That is, they step up to the plate to promptly and fully carry out their contractual obligations to policyholders when those individuals, families and business entities make good-faith pleas for assistance. They take due pride in responding responsibly in every instance.

Insurers are always susceptible to risk. They protect third parties against damages caused by often unexpected catalysts, such as nature-driven catastrophes. Insurance companies frequently deal with devastation that ravages a community in the aftermath of a major storm or event such as a mudslide, earthquake or fire. When, how and why those events occur can be unpredictable, if not flatly unforeseeable.

In exceptional cases, their consequences can surpass all expectations. Historically significant and wholly unpredictable calamities have sometimes surfaced that materially challenge both insureds and insurers in dramatic ways.

The recent and formally designated Camp Fire that torched huge swaths of northern California is a prime and horrifying example of that. That conflagration ranks as one of the largest fires in all recorded history. It nearly destroyed an entire town, taking scores of lives in the process. Reportedly, the flames reduced to ashes more than 18,000 homes and commercial properties.

High numbers of insureds were obviously harmed in that historic catastrophe and are duly filing insurance claims. Insurers are trying to deal with them, with some coverage providers understandably stumbling a bit as they seek to deal effectively with the unprecedented challenges facing them.

Insurers occasionally need help themselves, which is why they have reinsurance policies and are sometimes backed up by government entities that can step forward to help with claims in singular instances.

The Camp Fire unquestionably qualifies as such an event. It has challenged some insurers mightily. As a recent AP article notes, it has even rendered one insurer insolvent, resulting in its takeover by a state agency that guarantees claim payments to affected policyholders.

At the Louisiana law firm of Caffery, Oubre, Campbell & Garrison, our attorneys fully understand insurers’ challenges and diligently defend them when they need knowledgeable and aggressive legal help. We welcome contacts to our firm to discuss the impassioned and proven work we do on behalf of diverse insurance clients.