Landlord suing insurance company over fire coverage [Telegraph-Herald (Dubuque, IA)]

An area landlord is suing an insurance company for nearly

$1 million over coverage following a fatal fire at a Dubuque apartment building.

Aiman Al-Qady and his property management group, Angels LLC, are suing Aspen Insurance, UK, Ltd., over coverage for the apartment building at 605 Bluff St. A fire at the building in the summer of 2010 killed one man and resulted in significant damage to the structure.

The lawsuit, filed earlier this month in Dubuque County District Court, alleges that Aspen broke its contract with Angels LLC, acted in bad faith and was negligent in its claims handling.

Aspen, which bills itself as a global insurance company, does business in Dubuque County, according to court documents. The company issued a commercial property policy to Al-Qady for the Bluff Street building in July 2010. The policy included a $2,500 deductible and an insurance limit of $1.35 million.

The fire came just a few weeks later. It was caused by a cigarette and fueled by portable tanks of oxygen in the room, according to Dubuque city officials.

The estimated repair costs were about $1.8 million, according to the lawsuit.

When the blaze occurred, Al-Qady had not received a written insurance policy. In the lawsuit, he contends that Aspen applied a number of exclusions and conditions after the loss.

Aspen discounted the claim to about $433,000, after "improper manipulation" of repair costs and the application of the co- insurance penalty, according to the lawsuit. The company deducted $15,000 for emergency work paid in September and $100,000 paid in October for temporary relief, and paid a total of $315,000 in late January 2011, court documents said.

Al-Qady contends in the suit that Aspen has "engaged in a practice and pattern of delay and avoidance and (has) acted in bad faith" in its assessment of the claim. The suit also argues Aspen was negligent in its claims handling and violated reasonable expectations.

Al-Qady is demanding more than $919,000, or the balance of the policy limit, along with loss of rent and income. The lawsuit calls for a jury trial.

The TH was unable to reach Al-Qady for comment.

As a matter of policy, Aspen Insurance does not comment on litigation, according to a spokeswoman for the company.