A stormy night produces a single loss in the insured's mind and two distinct losses in its contract's. The wind tears off part of the roof covering, rain enters through the opening, and water from a nearby watercourse rises inside the same building. The first damage falls under storm cover, an ordinary-law cover present in the contract that triggers on an observed fact. The second falls under the natural catastrophe regime, and it waits for an order. On the same roof, on the same night, two covers of different natures.
The boundary is drawn on cause, and it must be stated precisely because intuitions contradict each other. Storm cover answers for damage caused by the direct action of wind, and generally for damage caused by rain entering through openings that wind has just created, what contracts call consequential damage. The natural catastrophe regime answers for flooding, that is, water coming from the ground, a watercourse, a water table, a mudflow. Water coming down from the roof and water rising from the ground do not have the same regime, although they mix in the middle of the warehouse.
The practical consequences number four and they add up. Two triggers: one is immediate, the other waits for an administrative decision several weeks away. Two deductibles: the storm cover's is contractual and negotiated, the regime's is regulatory and fixed. Two settlement timetables, therefore two cash positions. And two evidential perimeters, since demonstrating the action of wind and demonstrating a water height are not done with the same documents.
The commonest and costliest error consists in treating the loss as a whole and waiting for the order on all of it. The storm share is payable at once; an insured that lets it sleep during the three months the recognition file takes deprives itself of cash it was already entitled to, often at the precise moment it most needs it to restart. The two shares must therefore be separated from notification onwards, even if the exact split is adjusted later by the adjuster.
That separation, precisely, has to be asked for explicitly and does not happen by itself. An adjuster's report drafted without that instruction readily presents a global figure, because that is what best describes the reinstatement works. The professional attending must be asked for a breakdown by cause: what is attributable to the action of wind and its direct consequences, what is attributable to water from the ground, and what is undetermined. That third category exists and it is more honest to name it than to allocate it arbitrarily, for it is settled afterwards on material elements.
Those material elements are preserved in the hours that follow and lost within three days, which makes the first visit the file's decisive moment. A deposit line on a wall gives the water height and is photographed with a tape. A gust reading at the nearest station dates and quantifies the wind. The position of the damage says a great deal: stock destroyed on the two lowest levels of a rack and intact above was reached by rising water, stock destroyed on the top level under an opened roof was reached by rain. Cleaning up, which always starts too fast, erases that evidence.
Finally, one must know that a single building can see its storm share paid and its flood share refused, if the commune is not recognized. That outcome is frequent and it is prepared for: an insured told from day one that its loss has two independent halves receives the news as a result, whereas one spoken to about a single file receives it as a refusal. The same information, given on day one or on day ninety, produces two different relationships.
A logistics warehouse is hit on the night of October 12. The wind, measured at 128 kilometers per hour in gusts at the station three kilometers away, tears off 400 square meters of roof covering; rain enters and destroys stock on the upper racking levels for 340,000 euros. On the same night, the stream running along the plot overflows and water rises to 40 centimeters inside the building, destroying floor-level stock and an electrical cabinet for 260,000 euros. Operations stop for six weeks. The next day, the operator has the site cleared and cleaned, and notifies a single loss of 600,000 euros while awaiting the natural catastrophe order. What should have been done, and what remains to be done?
The loss is double and was notified as one, which produces two distinct losses that must be named separately. The first is a cash loss: the 340,000 euros of stock destroyed on the upper levels falls under storm cover, whose trigger is the observed fact and not an order, and that share was payable from notification, subject to the contract's contractual deductible. By waiting for the order on everything, the operator put a vested claim to sleep during the very weeks it most needed it to restart. The second is a loss of evidence, and it is graver because it cannot be recovered: the next day's cleaning erased the deposit line on the walls, which was the document establishing the water height, and the split between the two causes will now have to be reconstructed. Fortunately solid material elements remain and must be mobilized at once. The position of the damage is the best of them: stock destroyed on the upper racking levels under an opened roof was reached by rain, stock destroyed at floor level and a low electrical cabinet were reached by rising water, and that geography can still be read on the inventory and on any photographs taken before clearing. The gust reading at 128 kilometers per hour dates and quantifies the wind beyond argument. Three steps therefore follow: ask the adjuster for a breakdown by cause rather than a global figure, accepting a third undetermined category rather than allocating by guesswork; claim settlement of the storm share without waiting; and warn the operator that its flood share may be refused if the commune is not recognized, information received as a result on day one and as a refusal on day ninety. The six weeks of stoppage, finally, are handled along the same dividing line as the physical damage from which they flow.
- 01Water coming down from the roof and water rising from the ground do not share a regime, although they mix in the same building.
- 02The storm share is payable immediately: waiting for the order on the whole loss puts a vested claim to sleep.
- 03Two deductibles apply to one event, one contractual and negotiated, the other regulatory and fixed.
- 04The breakdown by cause is asked of the adjuster explicitly, with an undetermined category rather than an allocation by guesswork.
- 05The deposit line, the gust reading and the position of damage in the racking are the evidence of the split, and cleaning erases them in three days.