Troubled electric carmaker, Fisker is now facing fresh problems after its insurer refused to cover the loss of some 338 of its Karma range-extended cars.
Destroyed by flooding caused by Hurricane Sandy two months ago, the 338 Karma luxury sports cars were worth an estimated $33 million (around £20.3 million).
Failure by the company’s insurance firm XL Group PLC to pay up is prompting fears that the firm is teetering on the edge of oblivion after encountering a series of financial hiccups in launching its first model and follow-up vehicle, the Nina (also known as the Atlantic).
According to Reuters, the Anaheim, California-based start-up filed a suit against its insurer with the New York State Supreme Court last Friday, in a bid to get XL to pay for the loss.
The dispute centres on whether the cars count as being ‘in transit’, where sublimits to its policy would apply. The 338 Karmas were at the Port Newark shipping facility in New Jersey, where they were awaiting shipping, when the storm hit.
Fisker’s policy entitled it to a maximum $100 million of coverage for named storms such as Sandy, subject to a deductible and other provisions.
The firm, which only set up in 2007, is now seeking a court order to cover the vehicle loss, as well as damages for breach of contract.
Hurricane Sandy is expected become the second most expensive US catastrophe in history, behind only 2005's Hurricane Katrina, with insured loss estimates as high as $25 billion.
In Port Newark alone, more than 10,000 cars were damaged, including several thousand from Toyota.
Full story: Reuters.
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