UCSC Claimed Kerr Hall Damages and May Have Gotten Reimbursed

SANTA CRUZ, CA - In the recently released itemized receipts (which can be found here ) from Kerr Hall there are a few interesting things that may at first go unnoticed but may provide evidence that the UCSC administration has at the very least filed a claim for damages that occurred at Kerr Hall because of the occupation and possibly even was reimbursed for the costs. This may mean that UCSC students are being charged for things that have already been paid for, which raises questions about the validly and legality of those restitution charges.

On pages 1-17 there is a hand written note "Claim #2010102980" and on some pages there is also a hand written note "W000339640" accompanying the claim number.

Furthermore when American Technologies Inc. (ATI) sent their invoice to UCSC for their cleaning services, found on page 18, they sent a courtesy copy of the invoice to "Sedgwick Claims Management Services" at a P.O. box in Lexington, KY.

It would make sense for an institution as large as UCSC to carry property insurance especially on a property as valuable and important to the administration as Kerr Hall. Further research on the UC Office of the President (UCOP) website turned up information about "Sedgwick Insurance Claims Services". The UCOP website describing the systemwide property insurance policy which covers all buildings and their contents owned the Regents, found here, states the third party claim manager as "Sedgwick CMS" with a listed address that is the same as the Lexington, KY address on the ATI invoice.

Based on this, one can easily infer with some confidence that UCSC administration filed a claim with Sedgwick for the damages that occurred at Kerr Hall during the occupation in November. If this is true the next question would then be, is it likely that UC's insurance accepted the claim and reimbursed the school for damages?

Many commercial insurance policies do not provide coverage for damages that result from riots or other public disturbances and on further inspection of the UCOP property insurance page there is a list of what is generally covered and excluded from the property insurance plan, found here. It lists that vandalism is covered under the University's insurance policy. While we cannot be sure as we do not have access to the actual policy terms for the University's insurance it appears that the damage at Kerr Hall would be covered by the University's property insurance. Furthermore, the University describes the damages that occurred at Kerr Hall as the result of "vandalism" (this can be found on the ATI invoice).

If the University's claim was approved by the insurance company and was reimbursed how much then did the University pay out of pocket? The same website which lists what is generally covered and excluded from the University's property insurance plan also lists the deductible for the plan. The deducible is how much an entity must pay out of pocket before their insurance kicks in and pays for costs. In this case the deductible is 1,000 dollars meaning that if the total costs of the damages were reimbursed by insurance then the total cost to the University would be only 1,000 dollars.

While at this point it is impossible to know for sure if the insurance company approved UC's claim for damages at Kerr Hall it seems likely that at least some of the costs were reimbursed. Even if only some of the costs were reimbursed it does not make sense that restituion being charged to alleged participants is based upon the total $34,739.95 cost and not the actual out of pocket costs incurred by the University.

On another note, if the costs were reimbursed by the insurance company the insurance company usually has the legal right to collect on those charges. This legal concept is called subrogation. According to a commercial real estate lawyer familiar with this concept, it would be unusual for the insurance company to use a proxy like the University to recuperate those costs instead that would be done through a civil proceeding. It is important to note though that many policies written recently contain a waiver of subrogation rights.

The University should be clear and transparent about this matter. Students should not be charged for costs that have already been paid for by insurance and restitution should reflect the actual out of pocket expenses of the University. Saladin Sale from the UCSC Office of Risk Services, the person and department responsible for handling claims to the University's insurance, should release information either confirming or refuting these accusations. You can contact Saladin Sale at (831) 459-3261.