The Client and Its Challenge
An explosion and ensuing fire destroyed the casting facility of a leading manufacturer of automotive components. The company faced more than $100 million of damage and a potentially crippling period of suspended operations.

The Risk Consulting Solution
The Claims Accounting and Preparation Services (CAPS) practice arrived at the disaster site one day after the explosion and promptly began groundwork to establish claim-related expenditures and records the following day. Since production was suspended until the facility could be restored, sales subsequently decreased. Without enough revenue to cover the cost of rebuilding, securing a substantial initial payment was crucial to the client’s recovery. The CAPS team clearly demonstrated the extent of the disaster’s impact to the insurer and arranged for an adequate initial amount to be paid to the client. In addition, the team’s efficient groundwork led to a productive and cooperative relationship with the insurance company, which also expedited the recovery process.

Results
The client received $65 million initially to cover its surging recovery costs and enable the company to rebuild its casting facility. Furthermore, the insurance company offered a total settlement of $111 million before the end of the indemnity period. Consequently, the company was able to fully reinstate operations and achieve the same level of production as before the loss, ultimately making a full recovery.