Insurance Claims

Long International personnel have been involved in numerous insurance claims, including property damage, business interruption, advance loss of profits, and delayed start-up claims. We provide insurance claims analysis services to insurance underwriters and to owners who have experienced damage or delay to their plants as a result of fires, explosions, or other covered events.

Coal-Fired Power Plant
Indiana, Ohio
Provided claims analysis, cost and schedule analyses, and rebuttal report preparation services regarding insurance claims related to defective flue gas desulfurization systems on four coal-fired power plant projects.

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Combined Cycle Power Plant
Connecticut
Assisted insurance company against claim by the EPC contractor on a project involving the design, procurement and construction of a new 550 MW combined cycle power plant. The contractor claimed that an insured accident caused over $30 million in impact costs including 6 months of project delay and loss of labor productivity and increased support costs in attempts to accelerate to overcome delays. Performed a schedule delay analysis to demonstrate that actual impact of insured accident was negligible and concurrent with delays caused by the EPC contractor. Case was settled just prior to hearings.

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Condominium Complex
Florida
On behalf of the insurance company, performed a schedule delay analysis and provided expert testimony in litigation brought by the insured against an underwriter for severe weather-related delays during the construction of a condominium and commercial retail development in Miami Beach. The parties settled the litigation following deposition testimony
Florida
On behalf of the underwriter, evaluated the owner’s property damage claim and delays resulting from heavy rains and flooding on a residential and commercial condominium project.
Florida
On behalf of the contractor and underwriter, performed an analysis of reduced operating cash flows for a mixed-use building, including $5.1 million in damages claimed by the plaintiffs for alleged loss of profits related to the conversion of the apartment units to an independent living facility.

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Food Processing Plant
Georgia
Prepared cost estimates to support a $5 million insurance claim for food processing building and equipment losses resulting from fire, and provided project management of building stability and safety for examination and documentation of conditions resulting from fire and fire explosion damage. Supported the preparation of detailed CPM schedule analyses. Designated as a construction cost expert in support of the insured’s claim.

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Gas Plants
Canada
Provided claims analysis services for the insurance company regarding the reconstruction of a natural gas plant in British Columbia following an explosion. Performed a schedule analysis to determine when the reconstruction of the plant could have been completed absent the improvements to the facility made by the owner.

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Gas-Fired Combined Cycle Power Plants
Connecticut
Analysis of a $50 million delayed start-up claim on a 500 MW power plant. Evaluated project delays and cost impacts related to the Heat Recovery Steam Generator (HRSG) collapse.
Oregon
The project involved disputes between the owner, main contractor, and joint venture power island equipment supplier regarding damage to the combustion turbine (CT) caused by through projectiles in the power stream. The multi-party dispute involved both contract and insurance claims for delay, disruption, liquidated damages, and direct damage reparation works to the CT start-up operations. Management of claims team engaged to consult on both the contract and the insurance claims for the main contractor which involved delay, disruption, and damages analyses for a series of settlement negotiations and mediation. Ultimately the completion of the damaged CT works had to be factored into the process and the plant restored to full operational capability. Settlement talks were ultimately successful and formal litigations proceedings were avoided.
Pakistan
Engaged by the owner to prepare and submit to the insurer a $43 million Delayed Start-Up claim on a 175 MW combined cycle low BTU gas fired power plant. The claim included a detailed project delay and cost analysis related ten insurable incidents of which six were serial failures of the gas turbine due to design errors in the fuel nozzles. The delay analysis was complicated due to issues involving alleged concurrent delay, betterment, corrosion, and the impacts of policy extensions and modifications in coverage and waiting periods.

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Hospital
Texas
The hospital facility was badly damaged during a major hurricane storm. Provided full insurance claim review services working with claim adjusters to assess and review actual damage and required construction repair services. This involved a full construction assessment of building, services, and medical equipment damages including time/costs and rectification budget for repair and/or total replacement of facility.

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Liquified Natural Gas (LNG) Plants
Canada
On behalf of an insurance company, performed an analysis of delays to the construction of an LNG terminal in New Brunswick, including equipment to unload tanker, transfer to LNG storage tanks, vaporize the LNG, and meter the gas as it is introduced into the natural gas pipeline. The claim was filed by the owner as a result of materials being lost overboard at sea in severe weather while being shipped to the site.

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Mixed-Use & Retail
Georgia
On behalf of the insurance company, performed an analysis of a contractor’s claim for costs associated with repairs to damage resulting from a tower crane jacking failure on a mixed use development project in Atlanta. Prepared detailed analyses and reports to identify reasonableness of costs claimed in preparation of negotiation and settlement between the insurers, insured, and the insured’s contractor.

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Nuclear Power Plants

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Offshore Drilling Rig
Gulf Of Mexico
Managed the settlement of multi-million dollar insurance claims for an offshore drilling contractor arising from Hurricane Katrina and numerous other damage and warranty claims.
Gulf Of Mexico
Insurance and warranty claim preparation and negotiation on the installation of offshore drilling rigs. Management of claim team and preparation of documentation to support insurance claims for two failed semi-submersible drill rig thrusters.
Gulf Of Mexico
Prepared an insurance claim and negotiated damages to offshore drilling rigs as a result of Hurricane Katrina, including management of a team and preparation of documentation.
Singapore, Thailand
Prepared an insurance claim as a result of a failed applied paint system on a drill rig. The work was carried out partly in Singapore and later in Trinidad. Direct costs claimed including prolongation for the project management team, rig wet and dry tow, and shipyard shared costs.

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Oil Sands Facilities
Canada
Lead cost and schedule consultant retained by a group of insurance companies to evaluate the reasonableness of a $200 million cost estimate and cost/schedule risks associated with the repair of fire damage to four electrostatic precipitators and enclosures in a large oil sands plant in Alberta. The engagement involved site visits and interviews, and the evaluation of rebuild cost and schedule estimates and supporting documentation, with particular emphasis on assumptions, construction means and methods, labor costs and productivity, field indirect costs, contingency, and expediting and delay costs. Final work products included written reports which addressed the bases for and reasonableness of the repair schedule and cost estimate, and the cost impact of several expedited repair schedule alternatives, and oral presentations to loss adjusters and insurance company representatives.
Canada
On behalf of the insurance company, performed an analysis of a $200 million insurance claim for non-traditional coverages resulting from delays and cost overruns in the construction of a oil sands mine facility and upgrader unit in Alberta. Prepared expert witness reports in support of the ICC Arbitration.
Canada
On behalf of the insurance company, performed an analysis of a $500 million claim for business interruption losses due to delays to the start-up and commissioning of an upgrader refinery that was built to process synthetic crude oil from an oil sands production facility. The delays were allegedly caused by a fire at the oil sands production mine site, which delayed the transport of bitumen to the refinery through a 200-plus mile pipeline. Prepared detailed CPM schedule analyses and an expert witness report. Designated as a CPM expert witness in support of the ICC Arbitration in Alberta.
Canada
Performed an analysis of a major fire at an upgrader in Alberta that processed synthetic crude oil from an oil sands facility. Our client, a major construction company and its insurer, was defending against liability for property damage and business interruption damages amounting to $1 billion.

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Oil Terminal Project
Louisiana
On behalf of the insurer representing the contractor, prepared an Expert Report and provided testimony regarding the analysis of an owner’s property damage claim following a fire at an oil terminal which damaged the tank areas, including associated equipment, piping, electrical and instrumentation. Also evaluated the validity of the owner’s warranty claims that existed prior to the fire and included in the owner’s alleged damages. Prepared an Expert Report and testified in deposition, which led to a settlement of the dispute.

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Petrochemical Plants
Canada
On behalf of the insurance company, performed an analysis of a $50 million loss for property damage and business interruption resulting from cracking to a reactor vessel at a glycol process plant facility in Alberta. Prepared deposition questions and assisted loss adjusters and counsel for the underwriters with cost and schedule analyses.
Canada
On behalf of the insurance company, performed an analysis and prepared an Expert Report/testimony regarding an owner’s alleged business interruption loss due to an unplanned shutdown of an MTBE plant in Alberta.
Saudi Arabia
Engaged by the owner to prepare and submit to the insurer a $20 million Delayed Start-Up claim on a 400,000 mt/a polypropylene plant. The claim addressed the delays to the start of commercial operation due to two sequential failures of the sixth stage of the heat pump compressor steam turbine. The analysis was compounded by the need to address the effect of temporary repairs and allegations of betterment due to changes in design and material in the repair of the steam turbine rotor.
Saudi Arabia
Engaged by the owner to prepare and submit to the insurer a $24 million Delayed Start-Up claim on a 450,000 mt/a polypropylene plant. The claim addressed the delays to the start of commercial operation due to fourteen incidents of insurable damage. Three of the incidents were near sequential damage to the Reactor Effluent Compressor, which the owner claimed as one continuous event. The delay analysis was complicated due to the debate over the root cause of the damage to the Reactor Effluent Compressor, and consideration of the impact to the claimed delay due to policy extensions incorporating modifications in coverage and waiting periods.
Saudi Arabia
Engaged by the owner to prepare and submit to the insurer a $2 million Increased Cost of Working Claim under a marine policy. Components of the Plant’s fired heaters were lost at sea during transit from the fabricator resulting in a four-month delay in delivery of replacement parts. The owner and EPC contractor agreed to an acceleration plan which recovered 74 of the 120 days lost to re-fabricate and deliver new parts. The delay and acceleration analysis verified the delayed fired heaters were on the critical path, the acceleration was actual, and that no other concurrent delays impacted the critical path.
Saudi Arabia
Engaged by the owner to prepare and submit to the insurer a $24 million Delayed Start-Up claim on an ethyleneamines plant.
Texas
On behalf of the owner, performed an analysis of a $500 million property damage and business interruption claim resulting from fire damage to a petrochemical plant. Costs estimates for the property damage claim and schedule analyses were prepared considering acceleration, betterments, upgrades, and non-rebuilt facilities.

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Refineries
Canada
Performed an analysis of the expediting costs associated with the $320 million rebuild of a refinery in Alberta following a fire. This work was performed in support of the insurance company’s interest on a property damage claim filed by the owner of the refinery. Analyzed the trade-offs of increased time-related costs that would have been incurred had the work not been expedited compared to the increased costs as a result of a fast track schedule. The results of the various scenarios were evaluated using Monte Carlo calculations to derive a probabilistic determination of the range of costs as a function of the variables involved in the analyses. Analyses contributed to a successful settlement between the insurance carrier and the owner.

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School
Alabama
On behalf of the insurance company, performed an analysis of a contractor’s claim for costs associated with repairs to 25% of a recently completed community school. Prepared detailed analyses and reports to identify reasonableness of costs claimed in preparation of a settlement negotiation by the insurer.

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Sewer

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Undersea Pipeline
Gulf Of Mexico
Performed minor dispute resolution, claims execution, and settlement of change order requests for a pipeline installation contractor. The disputes included insurance “differences” caused by frustration/ force majeure following the terrorist attacks of September 11, 2001. Claims included additional pipeline installation and procurement, extra pipeline crossings, and other miscellaneous smaller claims for disputed extra work. Closed out change order requests, prepared fully substantiated claims and assisted in resolving major differences between the employer and the contractor.

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Wastewater Treatment Plant
Ireland
The project centered on the EPC design/build of a state-of-the-art sewage treatment plant to replace an old existing and over utilized facility in order to meet the current and future needs of the city. Due to site constraints the plant involved stacking SBR’s on top of each other, and building the new works parallel to maintaining the old plant prior to demolition. EU environmental regulations were critical to maintaining high standards of odor and treated water outputs. The plant ultimately failed to meet performance standards, was delayed in construction, and had operational issues for the local residential areas. Engaged to provide support in developing the main contractor’s construction claims (in conjunction with the main contractor’s consortium partners) against the owner and assist with resolution of insurance claims for E&O problems during the design process. This involved CPM and disruption analysis, plus coordinating outside counsel and other experts to support the contractor’s position.

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