Raiders of the Lost Profits – Part Four: Pit of Snakes – Establishing Period of Restoration

Pit of Snakes – Establishing Period of Restoration
There is a difference between Period of Restoration and Period of Suspension just like there is a difference between a king snake and a king cobra.  And there are also total suspensionsand partial resumptions.
Although many factors may impact the Business Income evaluation period as the claim progresses (such as valid delays, covered Ordinance or Law, delay in payment by the carrier, contractor availability, negotiated POR), the Period of Restoration is defined as the reasonable amount of time it should take to repair or replace the damaged property (including business space even if not owned by the insured or covered under the insured’s policy).
Many times, the process of determining a final Period of Restoration (POR), the adjuster should always evaluate the initial POR based on the reasonable time period and state that in his or her report to HQ.  Some consideration for adjustment time should be acknowledged separately.  If additional time should be considered or if actual suspension period should be considered, make that a separate acknowledgment so our client, as well as your partners in the Business Interruption office, can tell the difference.
Don’t fall into the snake pit!  Define exactly what you mean when you outline the Period of Restoration
Part Three: Search for the Grail:Covered Cause of Loss vs. Actual Cause of Loss
Part Four: Pit of Snakes:  Establishing Period of Restoration
Part Five: Reporting to HQ:  Here’s What We Know So Far
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