Louisiana Record

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Hospital sues insurer over building collapse during renovation

By Louisiana Record reports | Jul 29, 2014

GRETNA – A local hospital is suing its property insurer after a portion of one of its buildings collapsed when it was under renovation.

Ochsner Clinic Foundation filed suit against Lexington Insurance Company and Ochsner System Protection Company in the 24th Judicial District Court on June 26.

Ochsner Clinic Foundation alleges that it had property insurance provided by Lexington Insurance Company  through their captive insurer Ochsner System Protection Company for the term of May 31, 2011 through May 31, 2012. The plaintiff asserts that on Aug. 24, 2011 part of a building that was being repurposed collapsed and caused damage to Ochsner’s property and delayed their plans to relocate and expand their internal medicine practice and other operations. Ochsner Clinic Foundation claims that the building was included under Lexington’s policy and that they informed the insurer about the incident as soon as it happened, but that Lexington prolonged the investigation and claims handling process before finally submitting an adjustment that only took into account the cash value of items damaged in the collapse rather than replacement costs.

The plaintiff asserts that Lexington has still not paid the full amount it is owed under the policy.

The defendant is accused of violatiing state law and breach of contract.

An unspecified amount in damages is sought for penalties, attorney’s fees, interest and costs.

Ochsner Clinic Foundation is represented by Brandon C. Briscoe of New Orleans-based Flanagan Partners LLP.

The case has been assigned to Division L Judge Donald A. Rowan Jr.

Case no. 739-816.

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