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Architect David Piaker says a massive transformer explosion at a Con Edison plant the night of Hurricane Sandy shut off power to his East Village firm for nearly a week following the storm.

"Business was shut down," he says. "No access. No heat. No elevator service. No electric service. No telephone. No way to operate in the building."

Fifield, Piaker, Elman Architects filed a business interruption claim worth thousands. However, the partners were surprised to find that their insurance provider, CNA Financial Corporation, denied them, stating that the power outage was caused by flooding, and therefore, not covered by their policy.

"We looked further and there was a clause that said, under water, that if water causes an explosion, you would be covered," Piaker says. "Tue last response I got from them was, 'We've determined that it wasn't an actual explosion, it was an electrical arch event. There was no explosion, therefore, that clause doesn't apply.'"

It's a disappointing outcome, says Piaker, whose firm has been paying insurance premiums for 30 years.

"It was very frustrating, obviously," Piaker says. "We would pick this insurance up every year, and it's a standard part of the general liability package, and you think you're doing the right thing and being prudent and protecting your business and employees."

It’s a false sense of security, say many business owners affected by Hurricane Sandy, who are now trying to navigate through insurance loopholes.

NY1 reached out to CNA for comment on Piaker's claim, but hasn't heard back.

Piaker filed a complaint with the Department of Financial Services, which overseas insurance carriers, and for now, hopes more businesses come forward about the issue.