Ilyashev & Partners Secures Settlement of the Largest Insurance Compensation in Ukraine
Ilyashev & Partners Law Firm has successfully represented the interests of Budpostach – the leading national player of professional equipment and tooling market of Ukraine, in handling an insured fire accident which resulted in burning down the Company warehouse in Kyiv on 02 February 2019.
On 05 December 2019, the Insurance Company Universalna, where Budpostach insured its property (goods in circulation), made an out of court reimbursement of losses incurred by Budpostach as a result of the fire, and settled UAH 272.59 million of insurance compensation to the client of Ilyashev & Partners.
This settlement has become the largest negotiated in the Ukrainian insurance market in 2019, and one of the largest in its history. According to the National Commission for Regulation of Financial Services Markets, the total net volume of insurance payments made under property insurance contracts in Ukraine in January-September 2019 amounted to only UAH 320.7 million.
“From day one after the fire, our Company faced the challenge of finding a legal partner. Being aware of the large extent of damage and the risks associated with the settlement process, we attached fundamental importance to making this choice” – said Dmytro Shytlin, the founder of Budpostach. – We reviewed all the major insurance cases associated with fires in Ukraine in the course of recent years. In choosing a company for the representation of our interests we were primarily relying on the proven track record in resolving such cases in the past. As a result, we made a choice and addressed our partners – Ilyashev & Partners Law Firm – asking for their assistance in ensuring legal protection. Throughout the whole settlement period, the professional team of our partner rendered the full range of services aimed at the protection of our rights: consulting services, legal advice, review of documents and much more. It was the full range of services that allowed us to shape up our clear position and resolve the issue of having the insurance amount settled without recourse to court proceedings. We are grateful to Mikhail Ilyashev and his team for their help in organizing the process and its successful settlement”.
As a reminder, a fire occurred in a warehouse rented by Budpostach close to the largest market in Kyiv. As a result of the fire, a part of the warehouse – more than 10 thousand square meters, as well as the premises of other warehouse tenants, burned down.
The services of Ilyashev & Partners included representation of interests, provision of consultations and interaction with the insurance company as regards to winning the insurance compensation, rendering assistance in supporting the investigation and establishment of the causes and circumstances of the fire, as well as representation of the interests of the Client as of the suffering party in criminal proceedings initiated subject to Article 194 (2) of the Criminal Code of Ukraine (intentional destruction or damage to property through arson, which caused damage on an especially large scale).
The comprehensive forensic fire investigation and metallographic examination found that the fire resulted from a short circuit; no violations of fire safety rules in the seat of fire were detected. Taking into account the expert’s opinion, witness testimonies and other evidence gathered during the pre-trial investigation, as well as having due regard to the absence of the elements of crimes provided for not only by Article 194, but also Article 270 of the Criminal Code of Ukraine (violation of fire safety rules), the criminal proceeding was dropped in July 2019.
“The firm established intensive communication with the insurance company and assisted its experts and the investigation team in every possible way to determine the cause of fire, – said Mikhail Ilyashev, the Managing Partner of Ilyashev & Partners. – We are grateful to everyone involved for their professionalism and are pleased that, despite the huge amount of compensation, the parties managed to settle its payment out of court”.
Earlier, Ilyashev & Partners defended the interests of Biopharma during the investigation of fire, which occurred on 25 September 2017 at the plant located in Bila Tserkva, Kyiv Region, and compensation for damages. The total amount of property damage to the firm’s client amounted to approximately UAH 95 mln; another UAH 24 mln was paid in connection with the client’s financial losses caused by the interruption in production process.
According to the data presented by Ukrainian Civil Protection Research Institute, during 10 months of this year the number of fires in Ukraine increased by 25% and amounted to more than 86,000 incidents. Material losses from fires have also increased – they reached over UAH 9.4 bln, which is 37.6% more than in the same period last year. Yet, however, according to the data of National Commission for State Regulation of Financial Services Markets, in January-September 2019 the growth rates of insurance payments under property insurance contracts have decreased.
Private Enterprise Budpostach was founded in 1996. It has 71 branches in Ukraine, with more than 1,700 employees. The range of products of PE Budpostach includes over 30,000 goods of well-known manufacturers of professional equipment and tools, including Forte, Bosch, Karcher, Firman. The company cooperates with Rozetka, Epicenter and Tavria V trading networks.
Founded in 1997, Ilyashev & Partners is one of the most prominent law firms in Eastern Europe. Today, Ilyashev & Partners employs more than 120 people in Ukraine, Russia and Estonia with offices and representatives in Kyiv, Moscow, Tallinn, Dnipro, Simferopol, Odesa and Kharkiv. The firm is recognized by the most prestigious legal market research guides, according to which it occupies a leading position in the markets of Ukraine, Russia and Estonia.