The marine insurance industry is bracing for huge claims from Tuesday’s Baltimore bridge disaster.
Insurance claims from the collision of the Dali containership with the Francis Scott Key Bridge could be on par with a 2012 maritime disaster that led to $1.5 billion in payouts, John Miklus, the president of the American Institute of Marine Underwriters, told trade magazine Insurance Business on Tuesday.
Luxury cruise ship Costa Concordia capsized off the coast of Italy in January 2012, killing 32 people in one of Europe’s worst modern maritime tragedies. That disaster led to the marine insurance industry’s highest payout, according to the trade publication.
“I wouldn’t be surprised if this were similar,” Miklus told Insurance Business.
It was not immediately clear how long it took to settle all of Costa Concordia’s claims, but it appears to have taken at least a few years.
“You’ve got various components to the loss,” Miklus added. “A big one is going to be rebuilding the bridge and all the loss of revenue and loss of tolls while that’s taking place.”
The Baltimore bridge brought in about $53 million in toll revenue for the Maryland Transportation Authority in 2023, Moody’s analyst Cintia Nazima told The Wall Street Journal on Tuesday.
Other insurance claims from Dali’s Baltimore collision could include damage to the ship and its cargo, as well as business interruption, property, trade credit, and worker compensation, per Business Insurance.
The marine insurance and reinsurance markets are likely to foot most of the bills, S&P Global reported on Tuesday.
The Baltimore bridge itself is insured by insurance giant Chubb, per Insurance Insider.
Dali, the ship, is covered by Britannia P&I Club, a specialist insurer that provides protection and indemnity cover for the maritime industry. Britannia is a member of the London-based International Group of P&I Clubs.
The International Group of P&I Clubs will only cover the first $10 million in claims from any one incident, per the company’s website. The remaining bill will be shared by the members, groups from specialist marketplace Lloyd’s of London, and reinsurers.
The claims process could take years, mirroring the situation surrounding the Ever Given containership, which ran aground and blocked the Suez Canal for six days in March 2021.
SCOR, a French reinsurer estimated in June 2022 that Ever Given’s claims could top $2 billion.
“It will take many years to settle the claims from the Ever Given and the process will include much debate about who is liable,” SCOR wrote in the report. “The issue of responsibilities and applicable laws in today’s global maritime world is complex.”