Common Issues in Business Overhead Expense Insurance Disputes

Jan 11, 2019 | Blog |

Chicago Insurance Attorney

Insurers frequently act in ways that are hostile to the interests of a policyholder, in part because they hope that they can reduce their liabilities by forcing a policyholder to stop pursuing an otherwise legitimate claim for benefits.  This is especially true in the business overhead expense (BOE) insurance context, where the payouts can be quite significant (depending on the circumstances).

BOE insurance benefits can be critical for enabling a business to survive until the covered individual recovers from their disabled condition, or until a transitionary decision can be made (and a plan executed).  If you’ve had a legitimate BOE insurance claim denied or otherwise mishandled by an insurer, then you may be able to challenge their decision and secure the benefits that are owed.

Consider the following issues commonly encountered in the BOE insurance context.

Proving Disability

Proving that the covered individual is “disabled” can be rather challenging in a BOE insurance dispute, as the insurer may argue that the covered individual — if they had a diverse set of responsibilities — could modify their role somewhat and thereby continue to work.  Principals and employees with hybrid responsibilities in the workplace can have a difficult time showing that they are incapable of handling the primary duties of their occupation, as the “duties” of their occupation are not actually clear.

Conflicts Over Covered Business Expenses

BOE insurance policies can vary quite considerably in terms of the business expenses that are explicitly covered under the plan.  As such, depending on how specific the language of the BOE policy is, the insurer may attempt to argue that some of the expenses are not actually covered.

Illinois law ensures that ambiguous provisions in insurance contracts are interpreted in a manner favorable to the interests of the policyholder, however, so if you are involved in a dispute with an insurer over ambiguous policy language, then you may be at a significant advantage.

No Projected Expenses

BOE insurance coverage does not typically payout benefits for projected expenses — only expenses that have actually been sustained and are well-supported by the evidence.  As such, one cannot expect to receive a stable or consistent amount on a month-to-month basis.  The benefits will be paid out in accordance with the reported expenses.

Incentives to Create Barriers to Recovery

Insurers have significant incentives to make it more difficult for a business to recover BOE insurance benefits.  First, BOE insurance benefits can be substantial due to the fact that the expenses of an entire business are covered (not just the expenses of an individual).  Secondly, the nature of a business enterprise is such that the business may fall apart if it cannot pay its expenses for a month or two — as such, BOE policyholders may be forced to accept a reduced lump sum payout if they cannot present a sustained challenge to the adverse decisions made by their insurer.

Contact an Experienced Chicago Insurance Attorney for Comprehensive Guidance

Here at Bryant Legal Group, P.C., our attorneys have decades of experience assisting policyholders in a range of insurance litigation, including those that involve an underlying BOE insurance dispute.  We understand the unique challenges that are imposed on a business attempting to “right” itself after the loss of a valuable individual and have the know-how necessary to help you challenge the adverse decision of the insurer and secure the benefits to which you’re entitled.

Ready to speak to an experienced Chicago insurance attorney about your claims?  Call (312) 634-6160 or send us a message online to setup a consultation with an attorney here at Bryant Legal Group, P.C.

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