Hotels Affected by California Wildfires Urged to Act Now
November 1, 2017
Last month, wildfires streaked their way across California’s wine country, causing an estimated $3 billion in insured losses. That colossal number is expected to grow as more claims are reported by insurers, and hotels are urged to run, not walk, to do so.
Linda Kornfeld, partner at law firm Blank Rome and vice chair of the company’s insurance recovery practice group, said time is of the essence for hoteliers looking to have their insurance claims analyzed. Hotel operators, Kornfeld said, are often familiar with flood and hurricane insurance, but often lack experience when it comes to policies related to wildfires. She said hoteliers should come into these discussions expecting to debate the level to which their business has been disrupted, and have evidence as to why or how.
“Two weeks after the fires there were many properties still not filling rooms, and in many cases it was because people simply couldn’t get to these properties,” Kornfeld said. “Evacuations were taking place, roads were blocked due to fires, and in some cases there were undamaged hotels capable of receiving guests, but the guests were unable to reach the property, and that still counts as business being interrupted.”
Eventually, as access to these areas is restored and accessibility ceases to be an issue, Kornfeld said hotels should address how their policy protects them in the event of damage to surrounding areas, and their opportunities for reimbursement.
“Part of the advice we give to homeowners is to immediately reach out to their lenders and address the circumstances and the damage done to your property,” Kornfeld said. “Hotels should approach not only their lender, but their umbrella brands to see what sort of assistance they can get, and make sure those conversations are taking place.”
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"Hotels Affected by California Wildfires Urged to Act Now," by Elliot Mest is published in Hotel Management on November 1, 2017.