The Largest Katrina Insurance Verdict Yet Handed Down Yesterday

The verdict yesterday in favor of Robert’s Fresh Markets in New Orleans has set the bar for sheer dollars awarded in Katrina insurance litigation. The insurer is one that most people have never heard of, United Fire and Casualty Company. They also happened to be my business insurer when Katrina struck.

While it took me right at 15 17 months to settle my business claim with United it was chump change against the damage suffered by Robert’s. My own sense at the time after Katrina dealing with them is that the company’s claims adjusting process was overwhelmed by the scope of the disaster. The Robert’s verdict indicates they were also overwhelmed by the financial risk they took without benefit of reinsurance.

Susan Finch at the Times Picayune has the story:

The insurer for five Robert’s Fresh Markets should pay the grocery chain’s owner more than $21 million for unreasonably failing to pay what was necessary to fix Hurricane Katrina windstorm and other damage, a federal court jury ruled Monday.

“It’s the biggest Katrina judgment in Louisiana or Mississippi that we know of,” Philip Franco, who represented Marc Robert II in his battle against United Fire & Casualty Insurance Co., said Tuesday. Soren Giselson, head of the Louisiana Association of Justice insurance section, agreed with that assessment.

The $21 million award, Franco said, gave his client almost exactly what he said United Fire & Casualty Insurance Co. still owed him to repair the stores — $16.7 million — plus penalties for delaying payment.

Franco said the jury’s decision came after the jury heard “that this insurance company delayed and refused to make payments because of the financial stress put on that company because they didn’t purchase enough reinsurance to cover the extent of the catastrophic losses caused by Katrina.”

The Times-Picayune tried unsuccessfully to reach an attorney who represented United Fire & Casualty in the trial.

The jury’s verdict, capping a trial that lasted several days over two weeks, earmarked sums for limited liability companies that ran Robert’s Fresh Market stores in New Orleans on St. Claude Avenue, South Broad Street, Annunciation Street and Canal Street at Carrollton Avenue, as well as the original Fresh Market store on West Esplanade Avenue in Kenner.

3 thoughts on “The Largest Katrina Insurance Verdict Yet Handed Down Yesterday”

  1. They lost one of their locations when they couldn’t keep up with the $30K per month rent. I noticed the jury compensated the owner of the building for the loss of rent as well as the company for it’s losses.

    Basically, the biggest award to date, simply covered actual loss.

    Seems to me Sop this is yet another reason the proposed federal legislation to stick taxpayers with reinsurance cost is a step in the wrong direction!

  2. Interesting and ironic – I’m sure Sop will find it the same when he gets back from his all day meeting. Thanks btw what’s the word on the street down your way about the RICO case?

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