Industrial floorings manufacturer fire – £1.52m settlement

Location Cheshire

Customer Industrial floor coatings manufacturer

A large manufacturer of industrial floor coatings with operations across the UK suffered a devastating fire in its Warrington factory. This unit not only manufactured products for all three group companies but also housed a research facility and sales offices. The entire operations of the group were therefore severely affected.

Floor coatings manufacture involves the use of highly-flammable and volatile materials. In view of this, the insurer’s loss adjuster questioned the company’s compliance with the terms of the insurance policy and in particular its security and safety procedures. Faced with such a difficult negotiation, the management turned to Morgan Clark.

The claim

Morgan Clark’s immediate priority was to safeguard the future of the business. They found alternative premises for the sales offices so that customer contact could be continued, while some product manufacture was transferred to another unit and to sub-contractors. However, to receive full cover for its losses, the company still had to prove compliance with the terms of the policy.

Morgan Clark liaised with the insurer’s loss adjuster while it conducted two meticulous physical forensic investigations, and sat in during interviews with all 30 members of staff. Eventually, after protracted disputes and numerous solicitors meetings, the insurer accepted that the group had complied with the terms of its insurance policy but challenged the size of the claim.

While this was happening, Morgan Clark also worked with the company to find the most satisfactory way to re-instate the business within the terms of the insurance policy. In particular, they advised that there was the option to re-build on another site, and that this presented an opportunity to rationalise the group’s activities and save costs.

The results

Morgan Clark drew up in partnership with the company’s management an action plan to mitigate losses, and assessed the costs and benefits of these actions. After lengthy negotiations, the insurer finally agreed to the full £1.52 million claim, and also agreed that the manufacturing unit could be re-located to another group site instead of being re-built on the original site.

As a result, the company rationalised its operations and consolidated activities into fewer companies. Although the disruption led to the loss of some customers, this was more than offset by the savings achieved through re-locating the manufacturing unit.

More Case Studies

Cambridge

Fire damage in thatched cottage

"Mr and Mrs Hampshire suffered a fire at their thatched cottage, which started in the middle of the night when the family were asleep. The accidental fire was caused by a lighter being ignited, which resulted in blankets and pillows catching fire and ..."

Read more

Cumbria

Flooded bakery in Kendal: £100,000 insurance claim for machinery, st...

"Ginger Bakers is a very successful specialist cake producer based in Kendal, Cumbria, supplying commercial outlets across the country. When Storm Desmond wreaked havoc across the north of England in December 2015, the bakery’s leased premises were ..."

Read more

Cumbria

Flooding at kitchen worktop manufacturer: £1.2 million claim

"Stoneworld is a very successful manufacturer of quartz and granite kitchen worktops, importing expensive materials from across the world and using sophisticated precision cutting machinery. Based in Kendal, Cumbria, it distributes its high-end produc..."

Read more

Carlisle

Using Morgan Clark a second time for flood insurance claim

"When the river Eden flooded in Carlisle in 2005, water poured through David Allen’s substantial five-bedroomed semi-detached home. There was extensive damage throughout the downstairs which was likely to result in an insurance claim of around £100..."

Read more

Doncaster

Flooding – £630,000 business interruption claim

"In 2007, the town of Doncaster was hit by two floods in very quick succession. A large trading estate was very badly affected, including a successful steel processing and stockholding company. Three of its industrial units on the estate were contamin..."

Read more

South Wales

Residential college fire – £1.5m buildings and contents claim

"When an electrical fault caused a major fire at the UWC Atlantic College in South Wales, one of the school’s boarding houses was almost completely destroyed. The College’s immediate priority was to re-house the 52 students who lived there, so it ..."

Read more