Contractor Sues Insurance Company For Water Damage

CONTRACTOR SUES FOR COVERAGE FOR WATER DAMAGE

Essex Insurance Company v. City of Los Angeles and Los Angeles World Airports.

This interesting case concerns an issue of insurance bad faith and / or failure of an insurance company to cover a contractor for a job done near the Los Angeles World Airport. Professional Building Contractors Inc. was hired to soundproof buildings located near the Los Angeles Airport. Damage occurred to one of the project homes on October 15, 2004, when a severe storm blew an improperly secured tarp off of the roof which ultimately resulted in major water damage. Professional Building Contractors Inc., paid $125,000.00 to repair the damage to the home. When the contractor requested their insurance company to pay for the damages, they refused. The insurance company argued that the roof was not a “reported operation.” The contractor argued that the policy was intended to cover the entire “sound-proofing project.” The contractor cross-claimed against the insurance company alleging breach of fiduciary duty, unfair business practices, negligent misrepresentation, negligence and breach of contract.
Cross-claimant contractor was awarded $682,264 breach of contract and $2,500,000.00 in punitive damages against the insurance company. The jury voted 10/2 to grant contractor punitive damages against Essex Insurance Company.
If an insurance company refuses to cover you under your insurance policy call Penney and Associates for a consultation concerning your rights.