A hotel fire starts three clocks at once. The insurer's, the brand's and the lender's. They rarely agree.
Last updated: October 2026
The period of restoration, the franchise casualty clause and the loan's proceeds terms all start on the day of the loss. Your lost income has to be proven in RevPAR, occupancy and ADR. We document and negotiate the full loss for the policyholder, and we tell you plainly when a question belongs with your attorney.
Start a claim review
Tell us what happened. A licensed Texas public adjuster will review the loss with you, and tell you straight whether you have a fight worth having. The review is free.
For fire claims, we call you back within 1 hour and visit your property within 24 hours or less.
Most hotel fires are small kitchen fires. The 6% that spread through the building cause 56% of hotel and motel fire damage. If yours is one of those, the claim is decided by time and proof: how long restoration really takes, and what the property would have earned.
Source: NFPA, Structure Fires in Hotels and Motels (2009 to 2013 data).
Hotel fire claims: the first 72 hours
The general manager is walking guests and groups while the chief engineer meets the fire marshal. The owner is fielding calls from the insurer, the brand and the lender. What gets written down and kept in these first days sets up the rest of the claim.
- 1
Give written notice to everyone with a clock. The insurer, the brand, the lender and the management company. The standard business income form requires prompt notice, and one Marriott franchise agreement requires prompt notice of any casualty. Log every date and claim number.
- 2
Start the extra-expense file at hour zero. Extra expense covers necessary costs to avoid or minimize a suspension, such as walking guests and relocating in-house groups, and it starts at once. Business income starts 72 hours after the loss. Keep every receipt and walk log.
- 3
Do not throw anything out yet. The policy requires you to protect the property and permit inspection. Photograph and inventory smoky mattresses, wet carpet and soft goods by room before they leave the building.
- 4
Preserve the evidence. The room of origin and suspect appliances (dryers, PTACs, microwaves, lithium-ion devices), electrical panels, alarm and sprinkler-flow history, the alarm-monitoring company's signal log, key-card audit trails, CCTV and work orders. Ask for joint scene exams with every potentially responsible party before anything moves.
- 5
Keep paying the people you need. Business income includes continuing expenses, including payroll. Document who stays, who is furloughed and why.
- 6
Expect the scene to be held. Investigators at the 2018 Mineola Motor Lodge fire in East Texas could not enter a frozen building. After the 2024 Sandman Signature explosion in Fort Worth, the fire department handed its investigation to the owner. Log every agency contact; how you respond to investigators is a question for your attorney.
- 7
Ask before you reopen part of the hotel. Renting undamaged rooms can affect how a business income claim is read under your policy wording. See the Spring, Texas motel case below, and talk with your attorney before a partial reopening if the wording is in doubt.
Sources: ISO CP 00 30 10 12; Marriott SpringHill Suites franchise agreement §21.2 (SEC exhibit, 2016); KLTV (2018); Fort Worth Star-Telegram via Firehouse (2025).
Why your loss looks nothing like "typical" hotel fire statistics
U.S. hotels and motels report about 3,500 to 3,900 structure fires a year, with $84 million to $100 million in direct property damage, depending on whose estimate you use. Most are small. The damage concentrates in a few kinds of fire, and they are the ones that become large claims.
of damage came from the 6% of fires that spread through the building. 55% of fires were confined.
NFPA, 2009 to 2013 data
of damage, and 42% of deaths, came between midnight and 6 a.m., though those hours had only 17% of fires.
NFPA, 2009 to 2013 data
of damage came from intentional fires, which were only 7% of fires. Electrical distribution and lighting fires were 5% of fires and also 26% of damage.
NFPA, 2009 to 2013 data
average loss per nonconfined hotel or motel fire, against $25,090 for all hotel and motel fires.
USFA, 2014 to 2016 data
| Cause | Share of fires | Where its weight shows |
|---|---|---|
| Cooking equipment | 50% | 25% of deaths, only 8% of damage |
| Heating equipment | 9% | 16% of damage |
| Clothes dryers | 8% | 12% of injuries |
| Smoking materials | 8% | 75% of deaths (small counts) |
| Intentional | 7% | 26% of damage |
| Electrical distribution and lighting | 5% | 26% of damage |
The large fires start where electrical, appliance, laundry and framing risks sit. Among nonconfined fires, appliances caused 20%, electrical malfunction 13% and intentional acts 9%, and laundry areas were the origin of 13%. Structural framing was the first item ignited in 2% of fires but caused 17% of damage. Each cause points to a different expert, a different responsible party and a different evidence problem.
Fire department figures count direct property damage only. A July 2026 rooftop fire at a Tru by Hilton in Naperville, Illinois was estimated at $8 million in damage, and the building was declared uninhabitable. Business income, extra expense and code upgrades come on top of numbers like that.
Sources: NFPA, Structure Fires in Hotels and Motels (Campbell, 2015); USFA, Hotel and Motel Fires (2014 to 2016); City of Naperville via Positively Naperville (July 2026).
Three clocks: the insurer, the brand and the lender
A hotel casualty starts brand and lender clocks that rarely match the insurer's. Put them on one calendar on day one.
| Clock | Trigger and length | Source |
|---|---|---|
| Insurer: business income | Starts 72 hours after the loss and runs until repairs should be done with reasonable speed | ISO CP 00 30 |
| Insurer: after reopening | 60 more days of extended business income, unless an extended period of indemnity bought more | ISO CP 00 30 |
| Insurer: proof of loss | A sworn proof of loss is due within 60 days after the insurer asks for it | ISO CP 00 30 |
| Brand: notice | Prompt notice of any casualty | SpringHill Suites agreement §21.2.A |
| Brand: rebuild or terminate | Under 60% of replacement cost: renovate and reopen within a reasonable time. 60% or more: 180 days from the casualty to elect | SpringHill Suites agreement §21.2.B-C |
| Lender: insurance proceeds | Loan documents often let the lender apply proceeds above a threshold to the loan | Goulston & Storrs, PLI (2018) |
What one Marriott franchise agreement says
- A casualty exit can be free, with a condition. Casualty termination is not a default and carries no liquidated damages, unless the owner or an affiliate runs another lodging product on the site before the term would have ended.
- Default terms are expensive. The same agreement lists ceasing to operate as a system hotel as an immediate-termination default, with liquidated damages based on 24 months of average monthly fees.
- The franchisor keeps a stake. Terminating after a casualty does not cut off the franchisor's right to business interruption proceeds.
- Insurance is a brand standard. Business interruption cover is required, and policies cannot be cancelled or reduced without 30 days' notice to the franchisor.
What the lender side does
Rebuild duties generally do not depend on insurance proceeds, while the lender may apply proceeds above its threshold to the debt. In one published example, a $5 million loss applied to a $50 million loan can leave the owner bound to rebuild without the funds. On CMBS loans, franchise termination can be a recourse carve-out for the guarantor. A comfort letter gives the lender notice and a chance to cure an owner default with the franchisor.
These are the terms of specific published agreements, not yours. Only two Marriott agreements were reviewed. Whether a casualty closure triggers a default, how your lender may apply proceeds, and your rights under your own franchise, management and loan documents are questions for your attorney. Our part is to document the loss and keep the claim moving on a timeline that fits those clocks.
- Get the brand's reopening requirements in writing early. They define the scope you will ask the carrier to price.
- Ask the lender for its disbursement procedure, consultant and retainage terms before the first draw.
- Put any brand election date on the same calendar as the carrier's restoration estimate.
Sources: Marriott SpringHill Suites Relicensing Franchise Agreement (SEC exhibit, 2016), §§15.1, 19.1, 19.4, 21.2; Goulston & Storrs, Franchise Agreements and Loans (PLI, 2018); ISO CP 00 30 10 12.
Proving lost income: RevPAR, comp sets and your Texas occupancy tax returns
Hotel income loss starts with lost room-nights times the rate they would have sold at. The policy measures the result as net income plus continuing expenses. That means the number has to survive the carrier's forensic accountant, who will tie your PMS to your ledger to your STR reports and your tax returns.
The metrics
RevPAR is room revenue divided by available rooms times days. TRevPAR covers all revenue, including F&B, meeting space and parking. The RevPAR index compares your hotel with its comp set in the STR STAR report. Compare like periods, such as Christmas week with the prior Christmas week.
How we build it
We do not hand the carrier one calculation. Historical results, comp-set benchmarking and pre-loss budgets can produce significantly different numbers, so we model the loss each way and test the models against each other. We break out transient, group and corporate mix, meeting space, F&B and cancelled or relocated groups. The look-back period matters too: a soft year inside a multi-year average can drag your baseline down when it does not reflect normal operations.
Revenue is not profit. A credible analysis removes expenses you avoided, adds mitigation costs and separates market-wide swings from your loss. Results are measured monthly and comp-set data lags several weeks, so file an early estimate, then interim claims as actuals arrive.
Texas hotel occupancy tax records as evidence
Every Texas hotel already files a government record of its room revenue. The state hotel occupancy tax return lists rooms, total room receipts and taxable receipts for each location, filed monthly (due the 20th) or quarterly. Clean tie-outs between the PMS, the ledger and these returns build credibility with the carrier's accountant fast.
| Record | What it shows | Where it comes from |
|---|---|---|
| Your state HOT returns | Rooms, total and taxable room receipts per location, by month or quarter | Your own filings and payment confirmations |
| City and county HOT reports | Local receipts; some forms add room-night stays and declare a match to the state return | Your filings with the city or its collector, such as Baytown's quarterly reports |
| Competitors' reported receipts | What the local market did during your closure | Not posted publicly since SB 1086 (2017); the Comptroller's FAQ says they can be sought by open records request |
| Municipal HOT totals | City and county collections | Public at the city or county level only |
Total minus taxable receipts roughly isolates exempt revenue, chiefly guests staying 30 consecutive days or more, which helps show extended-stay mix.
Where your own data can cut against you
Extra business created by the same event comes out of the projection. During Harvey, Houston's convention center sheltered 8,000 evacuees, and a storm that fills the market can be argued to have filled your rooms too. Same months in prior years and market HOT totals are the answer.
Related tool: Business income worksheet.
Sources: ISO CP 00 30; Wikipedia, RevPAR; Insurance Journal (2017); Hotel-Online (Oct 2026); Texas Comptroller, Hotel Occupancy Tax, return help, FAQ and Hotel Receipts; City of Dayton HOT form; City of Baytown; data.gov; Wikipedia, Hurricane Harvey.
The period-of-restoration fight: FF&E, electrical gear, permits and brand approvals
The period of restoration ends when repairs should be done with reasonable speed, not when they are actually done. The carrier's schedule is theoretical. Yours has to be built from dated quotes and real lead times, because the slowest item often sets the whole loss period.
| What sets the timeline | Current figure | Source |
|---|---|---|
| FF&E, order to installation | At least 20 weeks, up from 14, per an FF&E supplier (Feb 2026) | HotelManagement |
| Overseas casegoods | Roughly 18 to 24 weeks for drawings, mock-up room approval, production and packing, before ocean freight (one maker's schedule) | Chiu Chiu Furniture |
| Pad-mount transformers | 40 to 65 weeks (2026) | Foley & Lardner |
| Medium-voltage switchgear | 52 to 80 weeks (2026) | Foley & Lardner |
| Accessibility review | Projects of $50,000 or more submit construction documents for TDLR review | TDLR |
| Trades after a catastrophe | After Uri, one Austin plumber had more than 2,500 customers waiting | Texas Tribune |
Prices move mid-order too. One owner's FF&E cost rose almost 20% after a tariff change between order and delivery. For scale, the MGM Grand reopened about eight months after its 1980 fire. A year after its January 2024 explosion, the 245-room Sandman Signature in Fort Worth was still closed.
Two gaps in the base form matter here. Time lost to code-driven work is not added to the period of restoration unless an increased-period endorsement was bought. Time spent testing for and cleaning up pollutants, such as asbestos found in an older building during demolition, does not extend it either.
After you reopen
Extended business income ends 60 days after reopening unless an extended period of indemnity bought more. A reopened hotel must rebuild OTA ranking, reviews, corporate accounts and group pace, and 60 days is often short. Check how many days your declarations show against a realistic ramp-up.
from FF&E order to installation, up from 14.
HotelManagement, Feb 2026
for medium-voltage switchgear in 2026.
Foley & Lardner, Sept 2026
of standard extended business income after reopening.
ISO CP 00 30
Sources: ISO CP 00 30; HotelManagement (2026); Chiu Chiu Furniture; Foley & Lardner (2026); TDLR; Texas Tribune (2021); Wikipedia, MGM Grand fire; Fort Worth Star-Telegram via Firehouse (2025); Sinclair news.
Smoke, soot, sprinkler water and FF&E: scoping a hotel loss
In a hotel, a room you cannot sell is a loss even if it never burned. On the day the carrier's adjuster walks through, the far wings can look fine. The scope fight is usually about how far smoke and water traveled.
| Pattern | What happens | What it means for the claim |
|---|---|---|
| Fire and char | Concentrated in the room of origin and any attic, soffit or chase | Structural scope; engineer and brand sign-off before rebuild |
| Smoke and soot in interior corridors | Travels through corridors, shafts and shared HVAC to floors far from the fire | The fight over which rooms and floors, and clean versus replace for soft goods |
| Corrosion | Acidic soot attacks PTACs, door locks, TVs, alarm panels and elevator controls | Failures can show up later; test and document before the contents scope closes |
| Sprinkler and hose water | Moves down through the floors below the fire | Drying logs, moisture maps and dated photos; Houston humidity raises mold risk |
| Older buildings | Asbestos or lead found during demolition | Testing and cleanup time does not extend the period of restoration |
Sprinklers were present in 52% of hotel and motel fires, and where wet-pipe systems were present they operated in 91% of fires. That is good for life safety, and it means many hotel fire claims are also water claims on the floors below.
What we do about it
We bring in industrial hygienists to test and document how far smoke and soot migrated through the property and its HVAC, establishing which rooms are genuinely unsellable and why. That documentation sets the true number of rooms out of service, which is the foundation of the lost-revenue claim.
For FF&E and OS&E, build a room-type inventory with invoices and brand specifications. Mattresses, FF&E and kitchen equipment carry salvage value, so agree any salvage credit in writing before items leave.
Sources: NFPA (2007 to 2011 data); ISO CP 00 30.
Building, FF&E, business income and the endorsements that set the limits
Most hotel claim fights are about time (how long restoration should take), measurement (what the hotel would have earned) and standard (what has to be replaced, and to what spec).
| Piece of the loss | Typical limit or limitation | What to check |
|---|---|---|
| Building | Actual cash value or replacement cost, per the declarations | Valuation basis, coinsurance or agreed value, and whether limits kept pace with rebuild costs |
| FF&E, OS&E and kitchen equipment | Business personal property limit | Room-type inventory with invoices and brand specs; what the brand will require on reopening |
| Business income and extra expense | Limit set at renewal; coinsurance applies unless agreed value replaces it | The coinsurance option on the declarations, and any limit on ordinary payroll |
| Franchise, management and marketing fees | Can keep running during closure where the fee base counts the lost room revenue that business interruption replaces | Claim them as continuing expenses; confirm your agreement's fee base |
| Extended period of indemnity | 60 days after reopening unless more were bought | Days purchased against a realistic ramp-up |
| Ordinance or law and increased period of restoration | The base form adds no time for code-driven delay | Whether both were bought, and which code edition the rebuild will be reviewed under |
| Utility services | Physical damage to scheduled utility property; overhead lines only if selected | Which utilities are scheduled, and whether overhead lines are |
| Civil authority | Starts 72 hours after an order bars access, within 1 mile of the damaged property, for up to 4 weeks | Written closure orders |
| Flood, named storm, coastal wind | Often separate policies and deductibles | Flood policy, named-storm deductible, TWIA if coastal |
For hotels, the sharper coinsurance risk often sits on business income: a limit set years ago against a smaller revenue base. One short limit cuts every income payment, though extra expense is exempt.
How a policy applies to your facts is a legal question when it is disputed. We document the loss and present it; coverage interpretation in a dispute belongs with your attorney.
Related tools: Coinsurance penalty calculator, Ordinance or law calculator, Actual cash value calculator.
Sources: ISO CP 00 30; CP 15 45 via InsuranceXDate; Open Exam Prep, BPP coverage form; Maine Bureau of Insurance; Courtyard by Marriott franchise agreement (SEC exhibit, 2014); Insurance Journal (2017).
The shortfalls in these claims are predictable. So is how we fight them.
Large losses in this sector are contested on a handful of recurring fronts. None of these mean the carrier is acting in bad faith, it means the policy is complex and the default reading of it favors the insurer unless someone pushes back with documentation. Here's what they try, and what we do about each.
Undamaged rooms could have stayed open, and fewer rooms do not always mean lost revenue.
Our move: We document life-safety impairments, smoke odor, brand limits on selling rooms and turned-away demand, room by room.
The schedule assumes a theoretical reasonable speed.
Our move: We reconstruct the timeline from real FF&E, electrical, permit and brand-approval dates and model the loss more than one way.
Trailing actuals become the ceiling, even for a renovated or ramping hotel.
Our move: We test history against the comp-set index, the budget and renovation and ramp-up data, and we contest a baseline dragged down by a year that was not normal.
Event-created business is excluded, and the market's surge is used to shrink your loss.
Our move: Same months in prior years and market HOT records separate the storm bump from your normal demand.
Soft goods and FF&E get cleaned rather than replaced, and scope stops at the burned rooms.
Our move: Industrial hygienist sampling establishes how far smoke traveled and which rooms are out of service.
Revenue-based franchise, management and marketing fees are left out.
Our move: We claim them as continuing expenses where the fee base includes business interruption proceeds.
Sprinkler, fire alarm and accessibility work is left out of the rebuild scope.
Our move: We tie the building official's requirements to the ordinance-or-law coverage you bought.
Expect intent to be tested on a large loss. Intentional fires are 7% of hotel and motel fires but 26% of damage. Expect questions about sprinkler or alarm impairment, renovation status and the accuracy of your statement of values too. If the carrier reserves its rights or asks for an examination under oath, talk with your attorney.
Sources: McLarens (2026); ISO CP 00 30; NFPA (2009 to 2013 data); Insurance Journal (2017).
What is different for a Texas hotel
Claim-handling deadlines
Texas gives insurers 15 days after written notice to acknowledge a claim and request documents, 15 business days after receiving everything requested to accept or reject in writing, and 5 business days to pay once accepted. When arson is suspected, the decision window is 30 days. Surplus lines insurers get 30 business days to acknowledge and 20 business days to pay. After a TDI-designated weather catastrophe, each deadline gets 15 more days.
Houston codes and accessibility review
Houston adopted the 2021 International Building, Existing Building, Fire and Energy Conservation codes, effective January 2, 2024. A hotel built under older codes can face newer requirements when it is repaired; which upgrades a repair triggers is the building official's call. Projects of $50,000 or more must submit construction documents to TDLR, and a Registered Accessibility Specialist reviews the plans before inspection.
Fire safety and federal travel
To be approved for federal travel, lodging needs hard-wired smoke detectors in each guest room, plus sprinklers at four or more stories, under the Hotel and Motel Fire Safety Act of 1990. If government travel is part of your mix, that approval is part of reopening.
Storms, freeze and power
Ike closed the 420-room Sheraton North Houston in 2008 after atrium roof damage let water into the lobby and meeting space, and flooded the lower level of Galveston's Hotel Galvez. The May 2024 derecho broke skylights at the downtown Hyatt Regency, but the hotel stayed open. Beryl cut power to 2.7 million people in southeast Texas. Utility services coverage needs physical damage to scheduled utility property; whether a grid-ordered outage qualifies is a question for your attorney.
Hotel occupancy tax
The state rate is 6% on rooms of $15 or more a day, and local rates generally run up to 7%. The tax is a cost and a ready-made proof source for lost room revenue.
Related tools: Texas prompt payment deadlines, Wind and hail percentage deductible, Ordinance or law calculator.
Sources: Tex. Ins. Code §§542.055 to 542.059; ICC (2023); TDLR FAQ; Hotel and Motel Fire Safety Act of 1990; Le Journal des Palaces (2008); Wikipedia, Hotel Galvez; ABC13 (May 2024); NHC Hurricane Beryl report; CP 15 45; Texas Comptroller.
Two Texas losses every hotel owner should know
A Spring, Texas motel after Ike
Hurricane Ike made about 40 rooms unrentable. The motel kept renting the rest, claimed $293,191 in business income and was paid $51,971. In H&H Hospitality v. Discover Specialty (S.D. Tex. 2011), the federal court read "necessary suspension" as a complete stop and found no coverage for reduced operations. The motel's own occupancy statistics suggested enough rooms remained to meet demand.
Lesson: Partial closures need the right policy wording and evidence of turned-away demand. Talk with your attorney about your wording before you decide how much of the hotel to reopen.
The Sandman Signature explosion, Fort Worth
On January 8, 2024, an explosion at the 245-room Sandman Signature, in a 1920 building that was undergoing some construction, injured at least 21 people. The fire department found no evidence of criminality and handed its investigation to the owner. A year later, no official cause had been made public and the hotel was still closed. Lawsuits name the hotel's parent company, its restaurant partners and the gas distributor; their claims are allegations, and the suits were still pending a year on.
Lesson: Gas and construction losses bring many parties, slow investigations and long closures. An owner's own cause-and-origin expert fills the gap a public investigation leaves, and any claim against a third party belongs with your attorney.
Sources: Merlin Law Group on H&H Hospitality v. Discover Specialty (2012); Texas Standard (2024); Fort Worth Star-Telegram via Firehouse (2025); Sinclair news.
Documents to pull this week
Start with the policy, franchise and loan agreements, whose clocks start at the loss. A 36-month look-back covers trend and seasonality.
Insurance
- Full policy with declarations, every endorsement and the statement of values
- Business income limit, coinsurance option and extended period of indemnity days
- Ordinance or law, increased period of restoration, utility services, civil authority and dependent properties
- Flood, named-storm deductible, TWIA if coastal
- Broker emails, last two applications, loss runs
Revenue proof
- 36 months of monthly P&Ls plus year to date
- Daily revenue and night-audit reports
- PMS exports of rooms sold, ADR and occupancy by segment
- STR STAR reports with the comp-set definition
- Budget, group pace report, cancellation log, group contracts and BEOs
- F&B, parking and meeting-room income
- State HOT returns per location and city or county HOT reports
- Federal tax returns
Continuing expenses
- Payroll registers and staffing plan
- Management-fee statements
- Franchise royalty, marketing and reservation fee statements
- Debt service, utilities, vendor contracts and equipment leases
Agreements
- Franchise agreement and amendments (casualty, insurance and fee-base sections)
- Latest PIP and brand quality inspection reports
- Brand standards for FF&E
- Management agreement
- Loan agreement, deed of trust, cash-management agreement and any comfort letter
- Ground lease
Building and life safety
- As-built drawings, permits and certificates of occupancy
- Fire alarm and sprinkler inspection, testing and impairment logs
- Alarm-monitoring contract
- Elevator and boiler certificates
- Kitchen-hood cleaning records
- Dryer-vent and lint cleaning logs
- Electrical maintenance and infrared scans
- Renovation history
- Asbestos survey for older buildings
Contents
- FF&E and OS&E inventory by room type, with invoices and brand specifications
- Pre-loss photos and video from brand inspections, marketing shots and OTA listings
Incident and after the loss
- Fire department and fire marshal reports
- Alarm-panel history, monitoring signal log and sprinkler water-flow alarms
- CCTV, key-card audit trail and registration for the room of origin
- Guest walk logs and every extra-expense invoice
- Mitigation contracts, moisture maps and dated photos
- Every written notice and reply
- A daily claim diary
Sources: ISO CP 00 30; Texas Comptroller, HOT return help; USFA (2014 to 2016 data).
The insurance company's adjuster works for the insurance company.
After a major loss, the carrier sends its own adjuster, and often a forensic accountant and engineering consultants, all retained by the insurer. They are competent and they are not neutral; their job is to resolve the claim on terms favorable to the company that pays them. A public adjuster is the licensed counterweight: we represent the policyholder only, we build and present the claim, and we negotiate the settlement.
On a hotel loss the asymmetry is the whole problem. The carrier brings a cause-and-origin investigator, an electrical engineer, a forensic accountant who will reconcile your PMS, ledger, STR and HOT records, a building estimator, an FF&E vendor and an industrial hygienist. We document the full loss with the same rigor, and we are paid a percentage of what we recover, so our incentive is your number. We are licensed public adjusters, not attorneys: when a question turns on your franchise, management or loan documents, on how policy language applies in a dispute, or on claims involving guests or third parties, we work alongside your attorney rather than in place of one.
What happens after you call.
Loss review and policy analysis
We read the actual policy - limits, BI and extra-expense provisions, ancillary-revenue coverage, ordinance-or-law, exclusions - and assess the full scope before anyone commits to a number.
Document everything, including the smoke migration
Structure, guest rooms, common areas, and the true reach of smoke through the property's HVAC. We bring in industrial hygienists to establish which rooms are genuinely out of service, while the evidence still exists.
Build the business-interruption claim, modeled several ways
From real performance and financial records: occupancy and ADR, each ancillary revenue stream, seasonality, and the right look-back baseline, modeled independently and used against each other to substantiate the full loss.
Present, negotiate, and settle
We present the documented claim, contest the predictable shortfalls, and negotiate the settlement on your behalf through to resolution.
Questions hotel owners and operators ask
How soon does business interruption pay after a hotel fire?
Under the standard ISO form, business income starts 72 hours after the loss, and extra expense, such as relocating guests, starts at once. Check your declarations and endorsements for the terms your policy actually uses.
Does insurance pay to relocate guests and groups?
Extra expense covers necessary costs to avoid or minimize a suspension of operations. Keep walk logs and every receipt from the first hour.
Can I keep renting the rooms that were not damaged?
Possibly, but talk to your attorney first if the wording is in doubt. In a 2011 Texas federal case, a Spring motel that kept renting after Ike was found to have no business income coverage for reduced operations under its policy's "necessary suspension" wording.
How is hotel business income calculated?
As net income plus continuing expenses. It is built from historical results, comp-set benchmarking and pre-loss budgets, which can produce significantly different numbers, so each should be tested against the others.
Can Texas hotel occupancy tax returns prove lost revenue?
They help. Each state return lists rooms and total and taxable room receipts per location, by month or quarter. They tie your PMS and ledger to a government filing.
Do franchise and management fees count while we are closed?
Revenue-based fees can keep running when the fee base includes the lost room revenue that business interruption replaces. One Courtyard by Marriott agreement counts it that way. Claim them as continuing expenses and check your own agreement.
Can my brand terminate my franchise after a fire?
One Marriott agreement gives the owner 180 days to elect to rebuild or terminate if restoration would cost at least 60% of replacement cost. Your own agreement's terms, and what they mean for you, are questions for your attorney.
Why is my lender holding the insurance check?
Loan documents often let the lender apply proceeds above a threshold to the loan. Ask for its disbursement procedure, consultant and retainage terms early, and take any dispute to your attorney.
What happens if we reopen but occupancy has not recovered?
Standard extended business income runs 60 days after reopening, unless you bought an extended period of indemnity with more days.
Will insurance pay for sprinkler, fire alarm and ADA upgrades?
Mainly through ordinance-or-law coverage. The base form's own code-upgrade coverage is the lesser of 5% of the building limit or $10,000, and the base business income form adds no time for code-driven delay unless an increased-period endorsement was bought.
Should I throw out smoke-damaged mattresses and linens?
Not before they are photographed, inventoried by room and available for the carrier to inspect. The policy requires you to permit inspection.
Is a power outage covered if my hotel was not damaged?
Only with utility services coverage, with the right utilities scheduled and physical damage to utility property. Overhead lines are covered only if selected.
What does it cost to hire a public adjuster?
We work on a percentage of the recovery, with no upfront cost. We're only paid if and when you recover, which aligns our incentive with maximizing your settlement. Fee specifics are discussed up front before you commit to anything.
Tell us what happened. We'll tell you straight whether you have a fight worth having.
No cost, no obligation. The fastest path is the phone - for a major loss, call and talk to a person today. A licensed Texas public insurance adjuster will review the loss with you.
713-369-4300Start a claim review
Tell us what happened. A licensed Texas public adjuster will review the loss with you, and tell you straight whether you have a fight worth having. The review is free.
For fire claims, we call you back within 1 hour and visit your property within 24 hours or less.
A major loss is decided in the first moves. Make yours count.
Talk to a public adjuster who works only for you. No upfront cost - we're paid a percentage only if you recover.
713-369-4300Crossroads Insurance Recovery Advocates · TDI License 1924788
This page is general educational information about commercial property claims, not legal advice or advice on your specific claim. Crossroads Insurance Recovery Advocates, Texas public adjuster entity license #1924788.
Don't take our word for it
- NFPA: Structure Fires in Hotels and Motels, Campbell, 2015 (2009 to 2013 data)
- USFA: Hotel and Motel Fires (2014 to 2016), 2018
- ISO CP 00 30 10 12: Business Income (and Extra Expense) Coverage Form
- InsuranceXDate: CP 15 45 Utility Services, Time Element
- Open Exam Prep: BPP coverage form (code upgrade, debris and pollutant limits)
- Maine Bureau of Insurance: actual cash value and replacement cost (consumer guide)
- Marriott: SpringHill Suites Relicensing Franchise Agreement, 2016 (SEC exhibit)
- Marriott: Courtyard by Marriott Franchise Agreement, 2014 (SEC exhibit)
- Goulston & Storrs: Franchise Agreements and Loans, The Comfort Letter and Beyond (PLI, 2018)
- Insurance Journal: Best Practices for Hospitality Business Interruption Recovery (2017)
- Hotel-Online: Why Lost Revenue Is Not the Same as Lost Damages (Oct 2026)
- McLarens: Business Interruption Losses in the Hospitality Sector (2026)
- Merlin Law Group: H&H Hospitality v. Discover Specialty, reduced operations after Ike (2012)
- Wikipedia: RevPAR
- Texas Comptroller: Hotel Occupancy Tax
- Texas Comptroller: Hotel Occupancy Tax FAQ
- Texas Comptroller: Hotel Occupancy Tax return help
- Texas Comptroller: Hotel Receipts
- City of Baytown: Hotel Occupancy Tax
- City of Dayton: hotel occupancy tax report form
- data.gov: Municipal HOT Receipts 2023
- Wikipedia: Hurricane Harvey
- HotelManagement: How tariff uncertainty is reshaping project budgets (Feb 2026)
- Chiu Chiu Furniture: Overcoming 2026 Hotel FF&E Delays
- Foley & Lardner: The Grid's Bottleneck Isn't Just Money (Sept 2026)
- TDLR: Architectural Barriers FAQ
- Texas Tribune: Texas plumber shortage after winter storm (2021)
- Wikipedia: MGM Grand fire
- ICC: Houston adopts the 2021 International Codes (2023)
- Wikipedia: Hotel and Motel Fire Safety Act of 1990
- Tex. Ins. Code §542.055
- Tex. Ins. Code §542.056
- Tex. Ins. Code §542.057
- Tex. Ins. Code §542.059
- Le Journal des Palaces: Sheraton North Houston to close after Hurricane Ike (2008)
- Wikipedia: Hotel Galvez
- ABC13: downtown Houston storm damage (May 2024)
- NHC: Tropical Cyclone Report, Hurricane Beryl
- Texas Standard: Fort Worth hotel explosion injures 21 (2024)
- Fort Worth Star-Telegram via Firehouse: probe and lawsuits continue a year after Fort Worth hotel blast (2025)
- Sinclair news: historic Texas hotel remains immediate danger zone
- KLTV: officials identify man killed in motel fire (2018)
- Positively Naperville: late night hotel fire results in estimated $8 million in damages (July 2026)