Grocery-store chain Trader Joe’s is suing its insurance company for allegedly failing to completely cover the damage when one of the chain’s New Jersey stores was destroyed in a snowstorm last year.
According to the lawsuit, Selective Fire and Casualty Insurance Company paid nearly $1.8 million on the claim, but refused to cover “basic and essential” parts of the new building like windows, doors, bathrooms and fire alarms.
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The grocery chain is asking for “the amount Trader Joe’s is entitled to receive under the policy,” the lawsuit said. The company asked for that amount to be determined at trial, according to a report by NJ.com.
According to NJ.com, the land and building occupied by the store were owned by a company called 155 Elm Street LLC, which leased the space to Trader Joe’s. The contract required 155 Elm Street to provide a building and replace any interior work damaged by a storm, the lawsuit claimed. 155 Elm Street purchased property insurance from Selective to cover that risk.
According to the lawsuit, after the store was destroyed by a winter storm, Selective refused to cover the complete building, excluding the costs of air conditioning, wiring, smoke detectors and other basic items, NJ.com reported. The insurer offered to pay $347,000 post-deductible – less than a fifth of the cost of replacing the building, the lawsuit claimed.
Three months after the new store opened, Selective offered to pay almost $1.8 million based on its estimate of rebuilding costs, NJ.com reported. However, that amount still excluded the costs of about 16 crucial parts of rebuilding, such as drywall, gas service and a temporary heating system, according to Trader Joe’s.
The lawsuit stated that 155 Elm Street assigned its claim against Selective to Trader Joe’s, but the insurer refused to meet with the grocery chain’s representatives.
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