03.01.2022 | 6:30 PM | ORANGE – The owner’s of a property that has been plagued by fires sued an insurance carrier for prematurely canceling their policy which possibly resulted in subsequent damage, according to a lawsuit filed Tuesday.
The owners of the property located at 2205 Palmyra Avenue sued Certain Underwriters at Lloyd’s, London, and insurance carrier, and Lakhani Insurance Agency, an insurance broker alleging breach of contract and negligence among other claims.
The lawsuit claims that the owner’s initially sought coverage from the insurance carrier and broker to cover property that housed a former YMCA facility in Apr. 2021.
On Oct. 16, 2021, nearly seven months after obtaining insurance coverage for the property, a second-alarm fire ripped through the former YMCA facility resulting in severe damage.
Shortly after providing notice of the fire to their insurance carrier the owners received a letter advising them their insurance policy had been cancelled months before on Jul. 28, 2021.
But that letter was not mailed until Aug. 10, 2021 and California law requires such notices of cancellation be sent with at least 30 days notice, the lawsuit claims.
Ultimately two other fires broke out on Nov. 17, 2021 and Dec. 3, 2021, further scarring the already damaged property.
Again, the owner’s provided notice of the fires but were denied coverage.
In their lawsuit the owner’s allege that both subsequent fires were preventable and could have been avoided had their insurance carrier accepted the claim and secured the property.
Alternatively the owner’s claim that their insurance broker was negligent by failing to comply with the requirements of the policy.
But this is not an isolated incident. The owner’s claim that Lloyd’s regularly cancels policies in order to limit it’s claim payments.
The lawsuit seeks compensatory and punitive damages and a court order declaring that the policy was not cancelled.
County News Service’s Courthouse News Reports are based on filings available through the Orange County Superior Court’s Media Access Portal. These reports are based on filings made by one party and only reflect allegations and claims made by one side of a lawsuit. Such filings are often the first step in litigation and do not reflect an order or finding of the Court.