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What is a Coinsurance Penalty?

by John July 30, 2010

When I work with clients who suffer a business interruption loss, one of the questions I often encounter is, “What is a coinsurance penalty and why am I not getting paid for my entire loss?” In short, if a policy has a coinsurance clause it means that the business must maintain a minimum amount of [...]

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How to Minimize the Chance of Employee Expense Reimbursement Fraud

by John July 27, 2010

Employees often incur expenses on behalf of their employer and then submit expense reports for reimbursement at a later date.  This common business practice is very useful because it allows businesses to operate efficiently without unnecessary delays related to petty cash disbursements.  Unfortunately, expense reports are one area that can allow easy pickings for employee theft.  According to the Association of Certified Fraud Examiners, [...]

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Utilities Can Be Unique in a Business Interruption Calculation

by John July 20, 2010

When quantifying a business interruption for an insurance claim, many expenses are easily identified as variable or fixed.  When I use the term variable, I mean that the expense changes with sales or production.  As a general rule, variable expenses are usually (but not always) saved and fixed expenses are usually (but not always) continuing.  [...]

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Forensic Accountant John Hutson Interviewed by CNNMoney.com About Business Interruption Issues Related to the BP Oil Spill

by Mary July 16, 2010

John was recently interviewed by CNNMoney.com reporter Catherine Clifford. In her article Florida: BP’s next big mess, John comments about business interruption issues and the impact that the BP oil spill will have on tourism dollars to the hotel and resort industries in Florida and all along the Gulf coast. The Importance of Proper Record [...]

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What’s the Difference Between a BP Oil Spill Claim and a Business Interruption Insurance Claim?

by John July 14, 2010

One word: policy. For BP oil spill claims, there is no policy. For almost two decades, the vast majority of my experience has been in calculating business interruption losses for insurance claim purposes.  Because the amount that a business recovers for a business interruption loss is limited by the provisions within the insurance policy, a [...]

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Gulf Coast Businesses Need Their Own Forensic Accountant

by John July 12, 2010

I recently watched the following video on CNN.  While I have a lot of empathy for the business owner in the story, I think that the angle that the reporter takes in the story shows the reporter’s lack of research into the subject matter by attempting to equate the term “forensic accounting” with “death” for [...]

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Why Should You Document Your Business Interruption Claim from the BP Oil Spill Right Now? Think Hurricane.

by John July 6, 2010
Thumbnail image for Why Should You Document Your Business Interruption Claim from the BP Oil Spill Right Now? Think Hurricane.

Some business owners are choosing to trust BP to “do the right thing” later on and are not immediately hiring a forensic accountant to calculate preliminary estimates of a business interruption loss related to the Gulf coast oil spill.  A business owner or corporate officer could be rationalizing that:  a) BP will pay these losses [...]

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Claims Communication: How to Talk to an Insurance Adjuster During a Business Interruption Loss

by John July 1, 2010

From the time you notify your insurer about  business interruption loss, and you have your first conversation with the insurance adjuster or their consultants, you are being deposed. Of course no one has sworn you in and no one told you that “everything you say can be used against you.” But this is the essence [...]

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Fraud Happens…Even in Your Company

by John June 29, 2010

The trust and optimism of business owners and managers never ceases to amaze me. No matter who I approach regarding fraud deterrence services they will tell me that fraud “doesn’t go on around here,” and “I trust my staff implicitly.” These are the same people who, once a fraud is uncovered, will say, “I never [...]

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Will Professional Fees for Claim Preparation be Reimbursed to Businesses Affected by the Gulf Coast Oil Spill?

by John June 24, 2010

I contacted the Bristish Petroleum claims hotline today and asked them the following question: If a business retains a forensic accountant to quantify, support, and create a claim for their economic damages related to the oil spill, will the forensic accountant’s fees be reimbursed? I think this is a reasonable question given that this is [...]

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