New Jersey Businesses Sue Insurance Companies over Known Risks That Weren’t Covered

 New-Jersey-Businesses-Sue-Insurance-Companies-over-Known-Risks-That-Werent-Covered-ImageTwo New Jersey businesses have filed lawsuits against their insurance companies for failing to provide them with adequate business owner insurance, which cost them millions of dollars in damages after Hurricane Sandy flooding.

Insurers Brokers Failed to Provide Necessary Coverage

According to, two recently filed lawsuits address the issue of insurance brokers failing to advise clients about their real insurance needs.  The first plaintiff company, Ethan Allen in River Edge, said that it lost approximately $1.5 million of inventory damaged by Hurricane Sandy flood waters.  Ethan Allen alleges that its insurance broker failed to inform the company that the warehouse where the merchandise was damaged was in a flood zone.

The second plaintiff company, the Raritan Yacht Club in Perth Amboy, said that hurricane flooding smashed bay level buildings and caused major damage.  While the yacht club was certainly aware that it needed flood insurance, it alleges that its broker simply specified that they were getting the “Cadillac” of insurance policies for yacht clubs.  That led Raritan Yacht Club to believe that the policy covered everything.

Both companies claim that they relied upon their brokers’ expertise in purchasing the appropriate types and levels of insurance to ensure that they were protected, which they ultimately were not.  New Jersey courts have held insurance brokers to a higher level of responsibility than insurance representatives because insurance brokers are licensed by the state not only to sell but also to advise clients on insurance coverage issues.

Insurance Companies Don’t Always Have Your Best Interests at Heart

Most people trust that their insurance companies will do right by them.  Unfortunately, as the examples above make clear, that does not always happen.  If you are battling with your insurance company over Hurricane Sandy proceeds, contact Belluck & Fox. Our experienced bad faith insurance lawyers understand what you’re going through and can help you get the compensation you deserve.