Baltimore Bridge Collapse: Who Will Pay for Destroyed Bridges, Damaged Businesses, and Lost Lives?
The collapse of the Francis Scott Key Bridge in Maryland is a multi-layered tragedy: a profound personal loss for the families and friends of those who have died or are presumed to have died. It's an economic nightmare for businesses that depend on the Port of Baltimore.
And for the federal courts, the balance between the dollar and the facts will soon be questioned because the insurance company network will bear at least part of the cost.
Before dawn Tuesday, an accident occurred where a cargo ship lost power and rammed into the Francis Scott Key Bridge in Baltimore. Eight people were on the highway bridge when the bridge collapsed. People have been rescued. Furthermore, 2 bodies were housed, and it is estimated that 4 people died while missing.
According to the economic analysis company Implan, this wreck will close the port of Baltimore, which is a major shipping port, and there is a possibility that it will cause hundreds of millions of dollars in damage to the region's economy from the loss of labor income alone over the next month.
According to a report by the credit rating company Morningstar DBRS, it is predicted that the current maritime accident exceeds about 1.5 billion dollars recorded by the shipwreck of the cruise ship Costa Concordia that occurred off the coast of Italy in 2012, and there is a possibility that it will be the most expensive marine insurance damage in history. Morningstar DBRS estimates that the total amount of insured damage due to the Baltimore accident will be 2 billion dollars to 4 billion dollars.
Here's a look at those costs, legal claims, and insurance companies:
What is a legal claim?
In federal court, lost lives and damaged property are narrowed down to questions of dollars and facts: was there any fault on the people or companies that owned and operated the ship? Was there any kind of negligence on the part of the people and companies that owned and operated the ship? How much would it cost to replace the bridge and put a financial burden on the families of the victims?
What the insurance company ultimately bears is at least part, if not the full amount.
According to Enrique Serna, a lawyer who specializes in defending migrant workers and those injured at work, his office was contacted by several victims' families shortly after the collapse. The people working to fill in the gaps on the bridge were people from El Salvador, Honduras, Guatemala, and Mexico, and some of them had worked decades before.
According to Serna, lawsuits are inevitable, and ship insurance companies will probably seek a “limitation of liability” in the near future and ask the judge to cap their compensation. Victims need to respond quickly so that the upper limit is not set too low.
“When can you claim damages is a race against time,” Serna says.
What will the economic costs be?
Attorney Thomas Schoenbaum, a maritime law expert and professor at the University of Washington, said the affected companies would not be able to sue shipowners or operating companies despite significant financial damage.
“Generally bad news: under maritime law, damages for pure economic loss cannot be recovered. Under maritime law, damages for pure economic losses are irrecoverable. Economic loss, that is, if money is lost, if the business is closed, if the business loses customers, unless there is some kind of physical damage along with economic loss, it is considered irrecoverable under maritime law.
However, losses due to pollution such as oil spills are an exception, and it is said that bridge wreckage does not constitute pollution under the Maritime Law.
Charm City Warehouse owner Bernard Sommer provides services to shipping companies that need to store cargo containers based in Baltimore.
“If we open the port within 30 days, we will lose business for 60 to 90 days. Opening it in 30 days is pretty fast.”
“Services to the Port of Baltimore will not be provided until this route is opened and shipped.”
Sommer says he has yet to contact the insurance company to see if damage associated with the closure of the Port of Baltimore will be covered by insurance.
“What if the building caught fire and you couldn't do business, or something like that happened? Yeah, that's covered. But I don't know if something like this one will be covered by compensation.”
“It's difficult. When you apply for insurance, the scope covered by the insurance is explained on page 1. Then, over 45 pages, it is written that it will not be covered.”
On Friday, Atlantic Maritime Ship Supply had to dispatch trucks to Newport News, Virginia to service ships originally bound for Baltimore. The owner, Edward Dryer, hasn't checked his insurance yet either.
He expects the port to gradually reopen in weeks rather than months.
“Let's be optimistic that at least part of the waterway will be opened reasonably fast,” says the dryer.
Experts say it would cost more than $400 million to replace the bridge.
What is the ship insurance company?
Ships and other vessels often have multiple types of insurance. They are often covered by insurance to cover damage to hulls and machinery, and they are also sometimes covered by insurance to cover cargo carried by ship.
However, for other extremely expensive damages, such as major environmental damage or disasters such as bridge collapses, large-scale ship owners use what is called “protection and compensation” or P&I insurance.
P&I insurance is provided by a “club” composed of insurance companies owned by multiple policyholders. Club members invest money into a pool of funds to cover catastrophe claims. This way of thinking is to share risks associated with major disasters so that no company bears them alone.
Insurance clubs may also enroll in their own insurance to cover expenses that cannot be handled by pools alone. This is called “reinsurance,” and the club is the first insurance to pay insurance claims, and then the second insurance to pay insurance claims becomes “reinsurance.”
The Britannia P&I Club insured ships involved in the bankruptcy. The London-based club is also part of the larger International Group of P&I clubs. There is also a possibility that reinsurers will cover part of the costs.
Original article ↓
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kenau : I don't know much about ship insurance, but from the text, it seems like the insurance company doesn't pay the full amount. There is also a limit on car insurance, but most cases of cars can be covered by 100% insurance. Ships are not comparable in price, so I'm wondering what kind of guarantee details are in the case of ships.
乱空 OP kenau : I'm guessing that just dealing with bereaved families etc. is likely to take a considerable amount of time to settle
![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
What will actually happen with regard to other treatments and damages...
Workers etc. at the port don't work, so they seem to have been suspended from employment or will be suspended, and there doesn't seem to be any guarantee for that...
kenau : If a shipping company goes bankrupt and an insurance company becomes unable to handle it unless it is a pretty insurance company, I feel like the country will eventually bear the burden. Those wrinkles are bouncing back to the public
It seems like it's going to be a major problem for America as a whole. It's not cargo, but who was responsible for the guarantee for that accident, which caused quite a few deaths of Korean students, the news is only at the beginning, and there are many cases where there are no final results, so I'm worried about whether it hasn't been solved yet.
乱空 OP kenau : There really are a lot of people who have the final wrinkles![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")