A manufacturer of hybrid-electric luxury sedans has filed suit against insurer XL Insurance over a claim the car-maker made after Superstorm Sandy.
The late-October storm destroyed nearly 340 Fisker Karma vehicles at a New Jersey port. The sedans were worth about $33 million, says Fisker.
According to the lawsuit filed in New York Supreme Court, the vehicles were submerged in more than 5 feet of storm surge from Sandy. Each car was totaled at that point, says the Anaheim, Calif.-based car manufacturer, but some vehicles sustained further fire damaged when a 12-volt control unit in one of the vehicles caught fire after the water receded at the Newark, N.J. port.
Fisker says it took out a policy with XL in July 2012 and notified the insurer of a loss on November 13. It followed up with a proof-of-loss on Dec. 3 and met with XL's adjusters. On Dec. 20, Fisker says it received word XL was denying the claim.
Fisker seeks damages for breach of contract, attorneys' fees and costs.
The lawsuit does not describe XL's reason for the claim denial. XL says it cannot comment on pending litigation.
The policy includes language limiting coverage to “insured premises,” but Fisker contends the definition includes damage to physical property while in transit.
The Karmas were part of 21 different shipments of more than 900 Fisker vehicles from Finland, where the cars are put together. The 338 vehicles at the port were subject to a safety recall and were awaiting service before they could be sent to dealers, according to court documents.
“Deviation and delay” in transit is also covered by the policy, claims Fisker.
Various deductibles and sublimits may apply to the claim, but Fisker says the policy is subject to an overall limit of $100 million per occurrence.
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