Claims experts help alleviate pressure when disaster strikes

04 September 2018

Hit by a tidal surge, the client had to respond quickly to the rising waters to ensure its business stayed afloat.

It operates from port-based premises, receiving input material for fertiliser, which is then processed for wholesale UK distribution.

Given its dockside location, it was vulnerable to a tidal surge and, when one struck, it found itself with a major flooding event on its hands.

There was widespread damage to raw material, work in progress, finished goods, plant, machinery and building assets.

The client had a robust insurance programme in place, comprising property damage (PD), business interruption (BI) and stock throughput insurance cover. But detailing, presenting and negotiating the claim, while minimising resultant losses, was a significant operation.


Major losses come with many different challenges and complexities. In this instance, the main issues included:

  • The logistics of sorting and assessing more than 5,000 tonnes of damaged product
  • Maintaining the operation and recovery of the business
  • Dealing with assessment and disposal of licensed product containing hazardous ingredients
  • Brand protection challenges relating to specialised products
  • Agreeing the salvage value with the insurer’s appointed surveyor
  • Implementing mitigation plans to minimise impact on future business
  • Managing the interface between stock throughput and BI coverages.


JLT’s major claims practice Echelon attended site meetings with loss adjusters and marine surveyors to progress the claim on all fronts. This included establishing a clear and transparent dialogue regarding the allocation of the claim between the PD, BI and stock throughput policies.

Echelon provided guidance and assistance to the client on the stock salvaging and negotiation strategy and liaised with surveyors appointed by the insurers. It also prepared and presented the PD, BI and stock claims while working in conjunction with the appointed loss adjusters. As part of this process, it proactively obtained their agreement to all of the key decisions, as they were taken during the recovery. This avoided any possible differences arising at the point of final settlement.

Echelon resolved a disagreement regarding the correct basis of valuation under the stock throughput policy, which was ultimately agreed as selling price. This was advantageous to the insured as it avoided a more onerous and complex BI claim process.

Echelon kept the insured’s executive board fully briefed on developments and strategies, enabling them to understand and plan the cash-flow impacts of the claim.

It also obtained frequent interim claims payments from the insurers, which further assisted cash flow and funding of the loss mitigation programme.


The client obtained a full settlement under the stock throughput policy, with minimal deduction for the client to retain salvage and payment of all relevant salvaging costs.

The property asset claims also met with minimal adjustments and the full cost of mitigation to maintain production during the recovery period, and protect future revenue and profit, was paid in full.

Ensuring complex claims receive quick, complete and accurate settlements is demanding. It takes technical expertise, practical understanding and significant resource. Without the support and specialist assistance Echelon provided, securing such an outcome could have proved much more difficult.

For more information contact Candy Holland, Managing Director for Echelon Claims Consultants on +44 (0)20 7558 3230.