Insurer underpaid five Denver metro businesses by $5 million for hail damage, lawsuits claim
By Kirk Mitchell | The Denver Post
Insurance claims made on auto and home insurance policies linked to a massive hail storm on May 8, 2017 total about $2.3 billion
Owners of five Denver metro businesses and shopping centers have sued the same Massachusetts insurance company claiming it underpaid them a combined $5 million for damages caused by egg-sized hail stones that pummeled the metro area during a 2017 storm.
Arvada Office Park and four Wheat Ridge businesses — Youngfield Plaza, Wheat Ridge Lumber, Lamar Industrial Park and Lee Kunz Development — filed separate civil lawsuits against Massachusetts Bay Insurance Company this week in Denver U.S. District Court.
Attorneys from the Merlin Law Group in Denver and the Stinar, Zendejas & Gaithe law firm of Colorado Springs are seeking double damages and attorneys fees against the insurer, claiming it paid them fractions of what they should have received to make needed repairs.
For example, Massachusetts Bay paid only $638,485, or 26 percent, of the $2.5 million in repairs estimated for two Youngfield Plaza buildings on the 3900 and 4000 blocks of Youngfield Street in Wheat Ridge, according to one of the lawsuits.
A message left with a media representative of Massachusetts Bay was not immediately returned on Thursday.
Insurance claims made on auto and home insurance policies linked to a massive hail storm on May 8, 2017 total about $2.3 billion, according to the Rocky Mountain Insurance Information Association. The association, a trade group for insurers in the state, based its damage count on 167,000 auto insurance claims and 100,600 homeowners insurance claims.
Massachusetts Bay insurance policies have a cosmetic roof exclusion in which it won’t cover superficial marring or pitting from hail or wind that doesn’t affect the functionality of the roof, the lawsuits say. However, all five lawsuits claim that damage by the storm caused damage to plaintiffs’ buildings impacting the functionality of the roofs.
J.E.I. Metallurgical examined hail divot samples from one of the Youngfield Plaza buildings and determined that corrosion had breached the last protective barrier, called the inter-metallic layer, reducing the functionality of the roof, a lawsuit said.
“Massachusetts Bay’s failure to pay the claims in full has resulted in financial hardship to Youngfield Plaza,” the lawsuit says.