By James R. Butler, Jr. and Robert E. Mangels
| The house is dark and all is still. Then, the telephone's sharp ring
shatters the pre-dawn quiet. As you grope for the bedside phone, you see
from the green glow of the clock radio that it is 3:00 A.M. Suddenly, you
are jerked awake by the voice of the General Manager of your destination
resort. In hoarse, exhausted, breathless rasps, he tells you of the hurricane's
horrors - the terrible loss of life, the dreadful injuries and the extensive
property damage. It was a direct hit!
Although you prayed the day would never come, you are ready for " Disaster". You know that it is critical to have your Disaster Team at "ground zero", as soon as possible - and no later than 24 hours after the event. The immediate response by your Disaster Team will save months and millions of dollars. This is too important to leave to the insurance company's positioning of the claim, followed by its "red tape", delays, and inevitable minimizing of the serious loss suffered. You are ready, and you would have been ready for any disaster, whether earthquake, fire, flood, riot or other Act of God. It will be a lot of work, but you will survive and everything will be all right. You start the pre-arranged calls to set things in motion. |
Earthquake, fire, flood, riot and other natural calamities do strike. When they do, too many hotel owners find themselves wondering: "What do I do?" "Who do I call?" "Does my insurance cover this?"
Before the disaster, you should carefully examine your insurance coverage. With our industry expertise and contacts, we can help you determine what your insurance coverage needs are and see if you have the needed coverage. Your broker's opinions are important but are probably not in writing and not legally binding on a carrier.
At the very least, you should know the types od policies in effect on your hotel and have full copies of all the policies (not just the cover page or binder). Get both sides of each of the policy's pages, not just one side of the two-sided form. Are all of the appropriate individual and corporate ownership, management and financing entities named as insureds on all of the policies? Do you have business interruption coverage? Do you have full replacement value coverage?
Before the disaster, you also need to develop an emergency response
plan. You need a designated emergency team with a clear set of procedures
to activate at the first hours of a crisis. The first 24 hours
| "We like to be at 'ground zero' within 24 hours, leading your disaster team to find and preserve critical evidence and offer the protection of the attorney-client privilege for vital and sensitive information gathered by your expert disaster team." |
after a disaster is the most critical period of time. Each member of your emergency team should be clearly identified, have specified tasks to perform, and should be ready to go to "ground zero" as soon as possible.
JMBM's Lodging and Leisure Industry Group has all the expertise you need to prepare for the dreaded disaster. We can help you evaluate your insurance needs and coverage, and help you prepare and implement your disaster plan. And if you weren't properly prepared, we can help you make the best of the situation because we know what to do.
We have experienced attorneys specializing in hotel insurance, litigation, real estate, tax, labor, and other critical disciplines. We have unique and internationally recognized experience in handling some of the largest fire, hurricane, earthquake, riot and other disasters.
For example, our Lodging Group experts represented clients in a number
of the most significant "mass disaster" cases in recent times, including:
We know how to "push the buttons" that can speed things up and facilitate a full and fair processing of your claim. We know how to spot the limitations in policies that may not be enforceable. We know the approaches that may get coverage for valid claims that might otherwise be denied or reduced.
We can make the biggest contribution to maximize recovery when we are brought into the game as early as possible. We like to be at "ground zero" within 24 hours, leading your disaster team to find and preserve critical evidence and offer the protection of the attorney-client privilege for vital and sensitive information gathered by your expert disaster team.
When the insurance carrier beats your team to the disaster site, they can ask witnesses questions in a way that elicits responses and recollections that are unfavorable but could be clarified with further questioning if someone protecting your interests was there. The insurance carrier may capture information that minimizes or defeats a claim, but fail to capture equally readily available evidence that could have established the claim. This may be unavailable in a short time as witnesses' memories fade, witnesses disappear, evidence decays or is lost and an image set by the carrier's inquiries takes hold as the "official view" of things. This can all be avoided if your team is at ground zero protecting your interests.
Some cynics might say that, "The insurance company is not your friend. It wants to pay as little as possible, and pay it as late as possible, if ever." We probably wouldn't go that far, but we believe it is in every owner's interest to bring the greatest expertise possible to bear on big claims at the earliest possible moment. What do you think?
Summary and Conclusion.
First: Involve your experts before the disaster to in-sure proper coverage and policies that give you what you thought you bought.
Then: Set up your disaster team and plan.
Finally: Once disaster strikes, put your team in ac-tion, or let us help you get things going before it is too late.
We have a unique depth of experience to help you in all phases of disaster review, planning, and response, including insurance claim oversight, negotiation and litigation. We believe that our expertise helps insurance carriers do the job that the good carriers (and all owners and lenders) want to see done.
Don't wait to call us until after your claim has been botched and your recovery is in jeopardy. Call us now to set up your disaster program. Or, if all else fails, call us immediately when disaster strikes!
JMBM is a full-service, business law firm of more than
140 attorneys with offices in Los Angeles and San Francisco and with an
independent network of over 1,600 lawyers in more than 75 cities world-wide.
We have been involved in hundreds of transactions spanning the globe and
representing over $12 billion in total sales, financings, and acquisitions
of lodging and leisure properties and companies. We handle: financing,
acquisition, sale, bankruptcy, ownership structure and dispute issues,
securities, litigation, mergers and acquisitions of companies, union and
employment matters, employee benefits, repositionings, management of franchise
matters, recreational use agreements, trademarks, litigation of any sort,
insurance claim, disaster, timeshare and vacation ownership, tax, foreclosure,
and virtually every other challenge.