I am often asked by potential clients if my forensic accounting fees to prepare a business interruption insurance claim will be reimbursed by the insurance company.
This question is completely valid because professionals who are experts in business interruption claims are not cheap, and risk managers, corporate officers, and business owners want to clearly understand what they’re getting into before hiring a forensic accountant to prepare their business income claim.
For me, the question is frustrating because it implies that if my fees are not reimbursable, then the insured should not retain me or any other forensic accounting expert. I know, from experience, that this is a false assumption for insureds to make. Here’s an example of why: I just closed a file two weeks ago. My total fees were approximately $27,000. What did the client get for that money? The insurance company, and the insurance company’s forensic accountant, valued the loss at $890,000. The final settlement, based on my calculations and critique of the insurance company’s report, was $1,650,000.
Was it a good investment of $27,000 for a return of $760,000, whether or not my fees were reimbursed by the insurance company? I know from experience that insured parties recover, on average, five times my fees in additional claim dollars. Yep, you read that right. On average, 500% ROI. Check out our results page for more real-world examples.
So, is it worth it to hire a forensic accountant to prepare your business interruption insurance claim, regardless of the professional fee coverage in your insurance policy? I guess the burning question is: Do you trust the insurance company’s expert to come up with the right number to settle your claim, or your own expert?
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