Superstorm Sandy has caused immense damage to the East Coast, with losses estimated in the tens of billions. Those affected face significant challenges as they begin the process of recovering from severe flood and wind damage, utility outages, impaired access, disrupted supply and customer chains, and extended business interruption. As companies turn to their insurance carriers for assistance, we offer this guidance, gleaned from our experience in representing corporate policyholders on their insurance coverage claims arising from scores of natural disasters.
Superstorm Sandy -- the freakish result of a massive tropical storm colliding with a cold mass that turned the storm inland -- has caused unprecedented damage to coastal areas lying in its destructive path, from North Carolina to Connecticut, and inland up to the Great Lakes. The storm caused enormous tidal surges that have inundated Lower Manhattan, flooded New York airports, and damaged railroads and other public transportation infrastructure critical to businesses up and down the coast. At the same time, the storm blanketed mountain areas to the west, from Virginia to Pennsylvania, with several feet of snow. In New York, the deluge flooded subways and tunnels, shorted out electrical systems supplying a variety of businesses, from telecom providers to internet services, leaving a corrosive moisture that could require weeks if not months to repair. As business and property owners take stock of their losses, plan their response, and examine their insurance policies, numerous questions will arise. To help address some of the inevitable issues, and to assist with the initial insurance claim process, we have prepared this guidance for our clients. We will likely issue a supplemental Advisory in the coming weeks in response to future developments.
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