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Although Seth Pehr, a locksmith in the World Trade Center, survived the events of Sept. 11, his business did not. Except for a few things he was able to retrieve, the entire contents of his 26-year-old shop were demolished and now reside in the Fresh Kills landfill, indistinguishable from the detritus of the hundreds of other businesses that were once located in the ill-fated complex. Ever since, Pehr has been trying to get his business back up and running. In large part, however, his post-Sept. 11 experience has only added insult to injury. And chief among the sources of his frustration has been his insurer, the St. Paul Fire and Marine Insurance Co. of Minnesota. Getting the company to pay up has been an “odious task,” said Pehr, who kept insurance for property, theft and business interruption losses. “It’s far from the simple phone call that people are being told.” Immediately after Sept. 11, things seemed more promising. Insurance companies took on the role of good corporate citizens, handing out checks like candy. Pehr, for one, got $25,000. But according to him and other small-business owners, once the media glare faded, the insurers’ purse strings snapped shut, their largess replaced by penny-pinching and foot-dragging. The company has contested him at every turn, Pehr said. On his property claim, he said he was able to document “easily $200,000 worth of property,” when he was briefly granted access to his shop before it was demolished. Still, the adjuster disputed his claim for $57,000, the limit on his policy. “He said, ‘Hey, this stuff looks like it’s in good condition. It has salvage value!’” Pehr said, incredulity in his voice. With the help of his lawyer, Jeannine Chanes, a partner at Fried & Epstein in New York, Pehr finally convinced St. Paul to give him full coverage, although he is still waiting for the check. He has yet to see a dime on his other claims. Payment on his theft claim — like many shops in the complex, Pehr’s store was looted — requires an investigation, he was informed. Pehr finds this to be beyond ridiculous. “How do you investigate a crime scene that isn’t there anymore?” he said. He was also told that he was eligible for only 7 1/2 months worth of business interruption insurance, even though he had a year’s worth of coverage. “They told me, Marsh & McClellan is back, Cantor Fitzgerald is back. You’re just a locksmith — it shouldn’t take you more than a couple of months to go back into business,” he said. But reopening a small retail shop is not that easy. “I get shown spaces that cost three or four times my previous rent with 75 percent less traffic,” Pehr said. A spokeswoman for St. Paul said it was against company policy to discuss a pending claim. Marvin Milton, a lawyer and president of Anderson Kill Loss Advisors, the Wellesley, Mass., insurance consulting arm of the law firm Anderson Kill & Olick, said the treatment Pehr is getting is typical. “They paper you to death. Then they let you hang out to dry while they are ‘working’ on your claim,” he said. Because the time it will take to restore the area is so drawn out, insurance companies are trying to reduce coverage by forcing relocation, Milton said. He added that he just resolved a similar dispute for a client that owned a soup kiosk in the complex, but it was “a very bitter struggle.” The insurer was trying to lay all the risk of the relocation on the policy holder, he said. STATISTICAL SUPPORT A survey of area retail stores and restaurants in late January offers some statistical support to the anecdotal evidence. The study by the Alliance for Downtown New York found that 60 percent of the claims filed were still being processed. Of the rest, only 5 percent of claims had been paid in full, 14 percent had been partially paid, and 20 percent received no payment at all. P.J. Crowley, a vice president of the Insurance Information Institute, an information arm of the insurance industry, said he had no doubt that the process was taking longer than normal just because of the sheer volume of claims, numbering over 30,000 to date. “You can’t have tens of thousands of claims and not recognize the unusual burden it places on everyone involved,” he said. Despite the reports of delays and nickel and diming, somewhat paradoxically, the New York State Insurance Department, which oversees the industry, has received very few post-Sept. 11 complaints. “We’ve only had 200 or so complaints,” a very small number considering how many claims have been filed, said Gregory Serio, the department’s superintendent. “It’s been refreshing to see the industry doing what it is supposed to do.” Even more reassuring was the lack of complaints from public adjusters, “who would normally be the first to complain,” he said. “If there were widespread problems, we would have heard from them.” Mark E. Seitelman, a personal injury lawyer with offices at 111 Broadway, had a different perspective. He said that filing a complaint with the Insurance Department would be “a waste of my stationery.” In his experience, he said, the department is only interested in large-scale fraud: “It’s worthless for individual cases.” Serio vigorously disputed this contention. “He’s absolutely, positively, categorically wrong,” he said. “We have dealt very successfully with individual claims.” Seitelman said that instead he was considering an independent appraisal of his claim because his insurer’s estimate of his losses fell so far short of his own. He figured the firm lost about $120,000 when it was locked out of its space for three weeks after Sept. 11, and another $130,000 in the month that followed. His insurer, using a different accounting method, put his total losses at $64,000. “I wasn’t expecting this hassle because initially the insurance company was pretty generous, advancing us $50,000,” Seitelman said. “But since then, they’ve been very picayune and calculating to their favor.” “I now know from direct experience the adversarial nature of putting in a claim,” he said. Of course, not everyone has met with such problems. Chanes, who is handling Pehr’s claims and several others on a pro bono basis, said a lot depended on “the luck of the draw of which adjuster you get. Some are great, others are not.” But she also agreed that, in general, insurers are being “very rigorous in demanding documentation and scrutinizing every line.” She said the magnitude of the disaster had also slowed things down: “Everyone has their plates full, with second and third helpings on top.” Although delay probably ranks as the most common complaint, some small businesses have been shocked to find their claims being denied outright. That is what happened to Jab Strong Fierce Entertainment Inc., an independent film company whose facility at 130 Cedar St. was destroyed by fire from the World Trade Center. Richard Lowe, the company’s producer, estimated that they lost between $500,000 and $600,000 worth of work on a documentary stored at the office. But their insurer denied the claim because the destroyed film was being edited at the company’s facilities rather than at an independent facility, as required under the policy. But Lowe said that he bought the insurance — and paid a premium of $5,000 — based on language that omitted the stipulation. He said he did not see the actual policy until after Sept. 11. “These people that should have been there to help us are reneging on their deal,” he said, adding that the company now “basically no longer exists.” “We thought the insurance company would come to our aid,” he said. “That’s what insurance is for.” “I wasn’t expecting this hassle because initially the insurance company was pretty generous, advancing us $50,000,” said attorney Mark Seitelman. “But since then, they’ve been very picayune and calculating to their favor.”

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