Claims Adjusting, Lightning Damage, Loss Mitigation, Warranties & Maintenance Agreements
While experts claim that the frequency of thunderstorms (lightning) is currently on the increase globally, it still doesn’t account for the seemingly exponential growth in “lightning” claims submitted by Insureds. The primary reason for the rise in claims is due to the increasing susceptibility of electronic equipment to damages associated with over-voltage exposure.As electronic technology advances, the components tend to become smaller. As the size is reduced, so is the microscopic spacing of insulators and circuits within them – making then more susceptible to over-voltage damage. The Integrated Circuits (ICs) in computers are particularly sensitive to high voltage since their transistors contain microscopically thin layers of glass (insulators). The glass is so thin that just a few tens of volts can cause a small spark to jump through the glass. When this happens, a small hole in the glass is created and allows the conductive layers on either side to make contact. Also, many other devices (such as diodes, transistors, etc.) contain extremely fine internal wires that connect the silicon components to the heavier exterior wires. A large surge of electric current can “vaporize” the thin wires the same way a fuse is “blown”.
Types of over-voltage damage:
- Catastrophic/Direct – a permanent alteration in the properties of one or more components that requires repair or replacement before the equipment can resume normal operations.
- Latent – a breakdown (most likely of the insulating materials) of a device that has the susceptibility to cause failure in the future. As imagined, latent damages are the most difficult to address during the assessment and adjustment phases of the claim. Properly addressed, however, the “what-if” concerns can generally be resolved by engaging Engineers and/or Technicians experienced with over-voltage and related reliability issues.
- Upset – a temporary malfunction (commonly resulting in gate leakage) without any physical change in the device or equipment. For example, a computer may recover from an “upset” by simply re-booting; the only loss would be data that was not written to the disk before the upset occurred, and consequential damages from the interruption of continuous operation. The consequential damages can be large, however, in medical equipment used in life-support systems.
When confronted with a lightning (or power derived) claim, be sure to ask the Insured whether a surge protector was installed. Many of the Manufacturers of surge protective devices provide a warranty that covers (with obvious limits) equipment that was properly connected to the device. Also, ask for a copy of the Insured’s power utility bill… some utility customers “lease” supplemental protective devices that also provide additional warranty/insurance coverage. It’s also advisable to check that the Insured’s structure has a properly installed centralized grounding system. If the cable or phone is NOT bonded to it, contact the appropriate utility and have them check the system (in most areas, it is the responsibility of the utility to provide such grounding protection). Many Adjusters are surprised to learn that these opportunities for possible subrogation exist.