Your Emergency BP Claim Affects Your Final Claim

As a result of the April 20, 2010 Deepwater Horizon explosion and the resulting Gulf of Mexico oil spill, British Petroleum (BP) set aside $20 billion dollars to help those affected who may have suffered losses or damages. BP decided to award the damage and loss claims in two main phases – an “emergency advance payment” phase, which ended November 23rd, and a “final claim” phase, which will end in August 2013. There will also be “interim claims” that can be made once per.

The BP Emergency Claim

Emergency advance payments were made available almost immediately after the disaster for the following claims: removal and clean-up costs, physical damages to property, lost business profits, loss or impairment of earning capacity, loss of subsistence use of natural resources, physical injury, and/or death. In this first phase, nearly half a million victims filed claims. These were mostly for lost profits and loss of earning capacity. These emergency monetary advance payments were designed to mitigate the losses already being suffered or likely to be suffered in the immediate future. They were not designed to satisfy all long term future losses.

The BP Final Claim

That is what the “final claims” process is designed for. An emergency advance payment is an advance on the payment of your final claim. Once you have collected all of the necessary paperwork and documentation and you are ready to file your final claim, you should file a final claim for any damages or losses you have sustained whether or not you have filed for an emergency advance payment.

How is your Final Claim Affected by Your Emergency Claim

It is important to keep in mind that an “emergency advance payment” is just that—an advance on your claim. The two are not mutually exclusive. Any advance payment you have or will receive, including any interim claims that you might file along the way before your final claim, will be deducted from your final claim. For example, if your complete and final claim comes to $100,000 but you received a $5,000 emergency advance payment early in the claims process, then your final payment will be for $95,000. If you file for interim quarterly claims while you are waiting for your final claim to be completed, then those payments will be deducted from your final claim as well. To put it simply, you cannot “double dip.” The emergency advance payments, as well as the interim claims, are designed to make sure you receive some money now instead of having to wait for your final claim, which could take considerably longer.

Now that the deadline has passed for the “emergency claims” phase, you may still apply for interim claims. These may be filed once per quarter until your final claim is complete. In any case, you should make sure that you begin the process of gathering paperwork and documentation for your final claim. The burden of proof is somewhat higher for the final claim, so you will need to make sure you can prove your losses and damages to ensure the highest possible claim settlement amount. Also keep in mind the strict deadline of August 2013 to file your final claim.